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Laos: The New Frontier For U.S. Companies

2104 words - 8 pages

The Ministry of Labour and Social Welfare (MSLW) establishes the minimum wage for workers in Laos. In 2009 along with Federation of Lao Trade Union (FTLU) and Laos Chamber of Commerce the minimum daily wage was set to 13,385 kip (approximately $1.60) with the minimum monthly wage being 348,000 kip. In addition employees pay 8,500 kip ($1) meal allowance per day. Civil servants and state employees are paid 405,000($47.80) per month. They receive a stipend for housing and other government benefits. Immigrant employees country, particularly from
Vietnam, China, and Burma, that are labor workers jobs such as on construction sites often earn less than the minimum wage (U.S Department of State, 2011).
The Laos people are not permitted to form or join a union unless given permission by the government and are sanctioned by the FLTU. Foreign workers may not participate in unions at all. Approximately 5 % of the Lao workforce belongs to a union. If a dispute occurs it must be resolved though workplace committees with representatives present for the employer, labor union and FLU. When disputes occur the FLTU representative must request permission to enter the facility and provide advance notice of the visit often times rendering them helpless to protect workers who filed the complaints (U.S Department of State, 2011).
Economic Disparity
The economy of Laos relies heavily on natural resources including mining and hydro-electricity. While the export of the resources produces revenue, total dependence on them will hinder the growth of the country. Laos must diversify itself into other sectors such as agriculture, manufacturing, tourism and garments to succeed as a nation. If these sectors are strengthened investments can be made in increasing educational and vocational institutions, as well as generate employment for the poor, women and younger adults. Development of transportations for the export of revenues may also be achieved with the strengthening of these sectors (Sisouphanthong & Myers, 2006).
To combat the lack of education and increase resources to the poor, in 2000 along with the 191 other nations Lao PDR adopted the Millennium Development Goals (MDGs). These goals are aimed at Laos’s development concerns, including the environment, human rights, and governance.
The Millennium Development Goals in Lao PDR
1. Eradicate extreme poverty and hunger
2. Achieve universal primary education
3. Promote gender equality and empower women
4. Reduce child mortality
5. Improve maternal health
6. Combat HIV-AIDS, malaria and other diseases
7. Ensure environmental Sustainability
8. Development for a global partnership for development
9. Reduce the impact of UXO
The goals are monitored and measured by the United Nations Development Plan (UNDP). The UNDP reports that Laos has made a fair amount of strides some MDG’s there is raising concern that the goal of achieving all nine by 2015 will be challenging (United Nation in Lao PDR). ...

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