ADB to Build Resilience and Reduce Poverty in Lao PDR

VIENTIANE, LAO PEOPLE’S DEMOCRATIC REPUBLIC (13 December 2024) — The Asian Development Bank (ADB) approved a $32 million financing package to help reduce poverty and food insecurity, empower women, and build resilience amid increasing health, economic, and climate vulnerabilities in the Lao People’s Democratic Republic (Lao PDR).

The Building Resilience and Reducing Rural Poverty Project will expand the government’s targeted, nutrition-sensitive conditional cash transfer (CCT) program, enrolling at least 25,000 poor and vulnerable households in 16 districts in the provinces of Khammouan, Louangphabang, Savannahkhet, and Xaignabouli.

“Climate change, together with high inflation, continues to impede food security and reduce household purchasing power, as nearly half the population consume less diverse food, limit portion sizes, and sacrifice adult meals so children can eat, heightening the risks of malnutrition,” said ADB Country Director for the Lao PDR Shanny Campbell. “The ADB will support the government’s efforts to expand social protection and improve food security and nutrition, in particular for women, and help them access sustainable livelihoods.”

Without social protection, poor and vulnerable households remain disproportionately vulnerable to external shocks, spending savings, cutting essential health expenditures, and borrowing money to eat. Nearly 1 in 4 people in rural areas live below the poverty line. In the face of these challenges, the government has been expanding social assistance coverage to deliver vital support to those most in need. 

The project will support the Lao PDR government’s efforts to expand coverage of the CCT program and reach poor women and mothers of children under 2 years old, including during shocks. It will also introduce a gender-responsive and climate-resilient poverty graduation program for rural women, building on the CCT with livelihood grants, technical skills training, support for financial and digital literacy and inclusion, and psychosocial support to help them pursue sustainable and climate-resilient livelihood opportunities. Finally, it will enhance social protection delivery systems for improved shock-responsiveness, build CCT implementation capacity, and support gender-smart and climate-responsive monitoring and evaluation.

The financing agreement was signed by the Ministry of Finance on behalf of the Lao PDR government and ADB on 12 December 2024 for the project. The financing package will include a $6 million grant from the Asian Development Fund, which provides grants to ADB’s poorest and most vulnerable developing member countries and a $6 million grant from the Green Climate Fund through the Community Resilience Partnership Program Investment Fund.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 69 members—49 from the region.