Lao People’s Democratic Republic (Lao PDR) is a unitary republic located in South East Asia. Its political system is structured around a single political party, the Peoples’ Revolutionary Party (LPRP). Decentralization in Laos has not been linear since the country’s independence in 1975. Until 1991, a significant level of autonomy and authority was allocated to provinces operating within a centrally planned economy. However, in 1991, Laos’ enacted a new constitution (revised in 2015) which entailed a major re-centralization of powers and reduced the role of local government (now referred to as “administration”) to supervising the implementation of (centrally-determined) policy at the local level. The Law on Local Administration (2015) divides local administration into three levels: provinces, districts, and villages. Starting in the 2000s, a new initiative began which aimed to allocate more power and autonomy to provinces and districts (known as the sam sang or “Three-Blocks” policy). In reality, subnational governance in Laos continues to be very tightly controlled by the central government and the Party.
Subnational governance structure
Laos is a unitary country with four governance levels: central, provincial, district, and village, of which the latter three are considered local levels. The 1991 constitution and the 2015 Law on Local Administration provide the overarching framework for central-local relations. At present, Laos’ local governance organs at provincial level consist of elected People’s Provincial Assemblies; a centrally-appointed provincial executive (Governor); and local offices of central ministries. Districts and (some) villages lack any form of representative body and are directly managed by provinces.
Nature of subnational governance institutions
Subnational governance institutions in Laos should be considered non-devolved entities. Provinces are administratively and budgetarily organized in a sectorally deconcentrated manner; they lack their own separate legal personality from the central government and are not authorized to directly manage their own funds. While provincial governors do wield certain powers, their position and role is a de facto extension of the central government (equivalent in many ways to a cabinet-level minister). As a result, provinces cannot be viewed as autonomous subnational actors, especially in light of the marginal decision-making role of the Provincial People’s Assemblies (PPA). Districts and (some) villages are part and parcel of the provincial budget and administration and therefore do not not meet any of the conditions to be considered a separate institutional unit.
Functional assignments
The decentralization of responsibilities to the subnational administration is broadly set out in the 1991 Constitution (Art. 18). In practice, local administration is assigned responsibility to deliver public services and infrastructure development in a wide range of functions on behalf of the central government. Most of the funding for these tasks comes from the central government and they are delivered via the deconcentrated (provincial and lower-level) offices of national line ministries. This arrangement is clearly indicated in the national budget document, with each province’s budget fully included in the national budget document, broken down in detail by economic and functional classification.
LoGICA Assessments
LoGICA Intergovernmental Profile: Laos 2024 (Excel)
Additional resources
Laos Country Profile (World Observatory on Subnational Governance and Investment, OECD/UCLG)
Laos PDR Public Expenditure and Financial Accountability (PEFA) Assessment 2018 (PEFA 2019)
Laos Public Finance Review (World Bank, 2023)
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Last updated: May 6, 2024