Study on Generating Employment through Micro and Small Enterprise and Cooperative Development in Lao PDR

Foreword, Acknowledgements, Abbreviations and Table of Contents

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Enterprise Development Consultants Co. Ltd.

Study on Generating Employment through Micro and Small Enterprise and Cooperative Development in Lao PDR
International Labour Office, Bangkok Area Office and East Asia Multidisciplinary Advisory Team (ILO/BAO-EASMAT), Bangkok, 2002

ISBN 92-2-113362-1

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Printed in Lao PDR

Foreword

Over the last several years the International Labour Organization (ILO) has given increasing attention to the role that small enterprises can play in alleviating poverty, building the foundations of an expanding private sector and creating decent work for greater numbers of people. In 1998, the International Labour Conference adopted a Recommendation on General conditions for the promotion of job creation through small and medium-sized enterprises. The key report by the ILO's Director-General, Juan Somavia, on the theme of Decent Work (ILO, 1999) similarly places high priority on the development of the small-scale enterprise sector as an important means for creating new employment opportunities. A renewed ILO internal programme was created on Boosting Employment through Small Enterprise Development (SEED) and this report is part of the range of the SEED Programme's global activities with special focus on the Asian region.

The ILO commissioned the present study of micro/small enterprises and cooperative enterprises in the Lao People's Democratic Republic so that key stakeholder agencies and groups could better understand this crucial sector, the constraints it still faces, and how best to promote its quantitative and qualitative development. The report reviews, compiles, and wherever possible, updates earlier available research and literature on the micro/small enterprise sector. It was conceived to give an initial broad overview and preliminary recommendations on how to help this sector generate increased employment.

The study was carried out for the ILO by Enterprise Development Consultants Co. Ltd., a local Lao firm with considerable research and training experience in the small enterprise sector. It was prepared with the support and technical supervision of ILO staff in Bangkok: the Senior Enterprise Development Specialist, Mr Max Iacono, with assistance from Ms Debra Perry, the Senior Specialist in Vocational Rehabilitation.

By placing this report in the hands of concerned stakeholders ILO hopes to create a useful springboard for future initiatives.

Ian Chambers
Director
ILO Area Office and
The East Asia Multidisciplinary Advisory Team
Bangkok

August 2002

Towards the end of 2001 an ILO fact finding mission to Laos proposed to Enterprise Development Consultants (EDC) this study on generating employment through micro/ small enterprises and cooperatives.

The EDC team of consultants who carried out the study were:

Ms Thiphaphone Phetmany, Consultant Team Leader
Ms Somchay Sulitham,
Mr Sengxay Fusinghua

The team would like to express its sincere thanks to the following:

Mr Max Iacono, ILO Senior Enterprise Development Specialist
Ms Debra Perry, ILO Senior Specialist in Vocational Rehabilitation
Ms Teresita M. de Leon, ILO Asia Pacific Regional Specialist in Cooperatives
Ms Piyamal Pichaiwongse, ILO Programme Officer Bangkok

Mr Bounvienne Doungngot, Secretariat, National Committee for Handicapped Persons
Dr Souphan, National Centre of Medical Rehabilitation
Mr Vienprasith Thiphasouda, Deputy National Director of Handicap International;
Mr Vangxay Phonelamoung, Coordinator, Community Based Rehabilitation Project
Ms Chanpheng Sivila, Board of Directors, Lao Disabled People's Association;
Mr Xenchao Kopyoa, interviewee;
Mr Sisaliao Svengsuksa, Administrator, Credit Cooperative for Promotion of Small Producers.
Ms Souzie Albone, Education and Training Consultant

Mr Max Iacono would like to thank Mr Gerry Finnegan, ILO Gender Specialist for his comments and Mr Tim Dyce, ILO consultant for final editing of the report.

Abbreviations

ACAP Association of Cooperation for Persons with Disabilities Asia Pacific
ADB Asian Development Bank
APB Agricultural Promotion Bank
BAFIS Basic and Further Training for Target Group from Informal Sector
CCSP Credit Cooperative for Promotion of Small Producers
CFD Caisse Fran?aise du D?v?loppement
EU European Commission
FPA Family Planning Australia
GAA German Agro Action
GTZ Deutsche Gesellschaft f?r Technische Zusammenarbeit Gmb
HI Handicap International
IEP Integrated Education Programme (From 2000: Inclusive Education Programme)
JICA Japan International Cooperation Agency
JOVC Japanese Overseas Volunteer Cooperation
IFAD International Fund for Agricultural Development
ILO International Labour Organization
Lao PDR Lao People's Democratic Republic
LDPA Lao Disabled People's Association
LHWCA Lao Handicapped Women and Children's Association
LWU Lao Women's Union
MIH Ministry of Industry and Handicraft
MLSW Ministry of Labour and Social Welfare
MoH Ministry of Health
NCCI National Chamber of Commerce and Industry
NCHP National Committee for Handicapped Persons
NCMR National Centre for Medical Rehabilitation
NSC National Statistical Centre
SEDP (Lao-German) Small Enterprise Development Project
SEED Small Enterprise Development
Sida Swedish International Development Assistance
UNCDF United Nations Capital Development Fund
UNDP United Nations Development Programme
UNESCAP United Nations Economic and Social Commission for Asia and the Pacific
UNIDO United Nations International Development Organization.
VRF Village Revolving Funds

Notes:

• A few acronyms are not included here. These tend to be NGOs appearing only once in a composite list within the report.
• The Lao People's Democratic Republic or Lao PDR is the official name of the Lao State. For ease of reading it is referred to throughout the report as Laos.

Foreword

Acknowledgements

Abbreviations

Executive Summary

SECTION ONE: INTRODUCTION

SECTION TWO: MICRO AND SMALL ENTERPRISES

2.1 Definitions

2.2 General Characteristics

2.3 Rural Entrepreneurs

2.4 Women Entrepreneurs

2.5 Entrepreneurs with Disabilities

2.6 Family and Multi-Business Enterprises

SECTION THREE: COOPERATIVES ENTERPRISES

3.1 Current International Status of Cooperatives

3.2 Definitions

3.3 Current Status of Cooperatives in Laos

3.4 Future of Cooperatives in Laos

SECTION FOUR: OPPORTUNITIES AND CONSTRAINTS

4.1 Education and Skills Training

4.2 Access to Credit

4.3 Infrastructure

4.4 Government Policy and Regulatory Framework

SECTION FIVE: SECTOR DEVELOPMENT PROGRAMMES

5.1 Government Objectives

5.2 Government Activities

5.3 Government Policy and Regulatory Framework

5.4 Business Development Services

5.5 Access to Credit

5.6 Support for Women Entrepreneurs

5.7 Support for Entrepreneurs with Disabilities

SECTION SIX: CONCLUSIONS AND RECOMMENDATIONS

6.1 Conclusions

6.2 Recommendations

Appendices:

References; Persons Consulted

Foreword, Acknowledgements, Abbreviations and Table of Contents
Study on Generating Employment through Micro and Small Enterprise and Cooperative Development in Lao PDR