TRIANGLE in ASEAN – Lao People’s Democratic Republic

The ILO TRIANGLE in ASEAN is a partnership between the Australian Department of Foreign Affairs and Trade (DFAT), the Global Affairs Canada (GAC), and the International Labour Organization (ILO). TRIANGLE in ASEAN delivers technical assistance and support with the overall goal of maximizing the contribution of labour migration to equitable, inclusive and stable growth in ASEAN.

Programme objectives

TRIANGLE in ASEAN has the overall goal of maximizing the contribution of labour migration to equitable, inclusive and stable growth in ASEAN. It builds on the activities, relationships and processes established under previous phases of the programme.

Programme outcomes

  • Protection: Migrant workers are better protected by labour migration governance frameworks;
  • Development: Policies and programmes harness the potential of women and men migrant workers to contribute to economic and social development and
  • Mobility: Labour mobility systems are gender-responsive and increase the efficiency of labour markets in the ASEAN region.

Labour migration

While economic growth and especially foreign direct investment in the Lao People’s Democratic Republic (Lao PDR) has been increasing, poverty reduction has been slower than in other ASEAN Member States. GDP growth has averaged seven per cent over the past decade, largely based on exploitation of natural resources (water, minerals, and forests) rather than a more diversified economy or a transition out of agricultural and subsistence employment. Consequently, labour migration remains an important livelihood option for the Lao workforce, including increasing numbers of Lao women. It is estimated that there are 0.9 million Lao nationals living abroad, of whom 56 per cent are women (UNDESA, 2019).

Patterns of migration in Lao PDR are complex, including both inbound and outbound flows of migrant workers. Thailand is the largest destination country for Lao migrants, primarily driven by wage differentials – the current monthly minimum wage in Lao is LAK900,000 (around US$110) and the Thai minimum is more than double this amount. Lao migrant workers in Thailand are predominantly employed in domestic work, construction, manufacturing, agriculture, and entertainment work, mainly in neighbouring border provinces and larger cities. Financial remittances from migrant workers are a significant source of income within Lao PDR. An estimated US$254 million in remittances was received in 2019 (World Bank, 2019).

The legislative framework governing labour migration from Lao PDR remains unclear in many aspects. Although a major sector of employment in Thailand, the migration of Lao women abroad for domestic work occurs outside of formal channels. Recent legal changes that resulted from the adoption of Decree 245 in May 2020 have clarified that domestic work is a potential sector for regular migration, but regular recruitment has not yet commenced. The Decree is a positive step, though several areas within the Decree would benefit from the development of subordinate legislation or policies that could guide rights-based implementation.

The latest Memorandum of Understanding between Thailand and Lao PDR was signed in 2016, broadening a previous agreement on labour migration to include cooperation on social security and skills development. Only a small number of Lao migrant workers migrated under the previous MOU because of the high fees, slow process, and administrative complexity involved. Specific costs for migration are not included in the new Decree 245, which is a vital area for ongoing work to ensure migrant workers are able to accurately predict costs of regular migration, and make decisions accordingly.

There are 35 recruitment agencies in Lao PDR, with 33 permitted to send Lao migrant workers abroad. The new Decree 245 makes some requirements relating to licensing of these agencies, though it is not yet clear if all previously licensed agencies will need to requalify as a result of the adoption of the new Decree. Regardless, further clarity on the requirements for licenses and the inspection, and sanctioning regime for recruitment agencies could be provided by subordinate legal instruments.

For further information please contact:

Mr Vongtavanh Sayavong
National Project Coordinator (NPC) for Lao PDR
Tel.: +856 20 7777 8421
Email: sayavong@ilo.org