Market Summary

Local Currency Bond Market Size

The Lao People's Democratic Republic's (Lao PDR) total local currency government bonds outstanding increased 21.2% year-on-year (y-o-y) to LAK 30.6 trillion at the end of 2023 from LAK25.3 trillion a year earlier. At the end of 2023, recapitalization bonds (33.3%, LAK10.2 trillion) and triangular bonds (29.7%, LAK9.1 trillion) collectively comprised over 60% of the Lao PDR’s local currency bond market. This was followed by triangular bonds (29.7%, LAK9.1 trillion), investment bonds (17.8%, LAK5.5 trillion), fiscal deficit financing bonds issued via the Lao Securities Exchange (13.3%, LAK4.1 trillion), and Treasury bills (5.9%, LAK1.8 trillion).

Foreign Currency Bond Market Size

Total foreign currency (FCY) bonds outstanding in the Lao PDR reached USD2.6 billion at the end of 2023, slightly down from USD2.7 billion a year earlier. The Thai baht remained the predominant currency in the Lao PDR’s FCY bond market, with THB-denominated bonds comprising 80.5% of total FCY bonds outstanding at the end of 2023. FCY government bonds outstanding declined 6.7% y-o-y to USD1.1 billion primarily driven by reduced issuance and a large volume of maturities, resulting in a lower corresponding share to total FCY bonds of 40.5% in 2023. Meanwhile, FCY corporate bonds outstanding (USD1.6 billion) comprised 59.5% of total FCY bonds outstanding on marginal growth of 0.3% y-o-y.