Lao PDR Strengthening the National Statistical System

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The Lao People’s Democratic Republic, a lower-middle-income country of 7.3 million people, is a small landlocked country with abundant natural resources. Having been one of the fastest growing economies in East Asia and the Pacific before COVID-19, Laos is experiencing a growth slowdown. While the economy grew at an average of 7.0 percent per year between 2003 and 2019, signs of deceleration appeared in 2013. GDP growth steadily declined from 8.0 percent in 2013 to 5.5 in 2019, before falling to 3 percent in 2021 owing to COVID-19. Laos is also facing deteriorating macroeconomic conditions. Fiscal stress has forced expenditure cuts in key development areas, while the exchange rate depreciation has exacerbated the impact of rising global inflation on livelihoods and food security. The regional context plays a key role in shaping economic opportunities, with the Laos-China railway representing an important investment in regional connective infrastructure. Against the backdrop of this shifting and increasingly complex and transforming economic landscape, evidence-informed decision making is more important than ever. The national statistical system, known as the Lao PDR Statistical System (LSS), consists of the Lao Statistics Bureau (LSB), the statistical centers of line ministries and agencies, and the statistical centers at the provincial- and district- levels. LSB, a semi-autonomous ministry-equivalent organization, is the main producer of official statistics and the LSS coordinator. Laos has made progress in advancing its statistical capacity in recent years. Activities within the realm of official statistics have grown over the years. There has been an increase in data production both by LSB and the statistical centers of line ministries to support the policymaking process. The growth momentum reflects an increasing level of government support and continuing collaborative efforts with bilateral and multilateral donors. A demand for the statistical system’s products is strong, both from the Government of Laos to support monitoring and evaluation of the National Socio-Economic Development Plans (NSEDP) and from international communities.Despite what has been achieved in the past few years, high-quality data to guide decision making are lacking and there are still important data gaps to be filled and data dissemination to be strengthened. Laos lags its regional peers in advancing the national statistical system’s performance. The country’s overall Statistical Performance Indicators (SPI) score was estimated at 54.1 in 2019, lower than 56.2 for Cambodia, 66.0 for Vietnam, 72.2 for Indonesia, 75.7 for Philippines and 76.1 for Thailand. The largest gap is in data services, in which the country ranks in the lowest quintile of the global ranking, suggesting an opportunity for improvement in areas of data dissemination, data releases, online access, and other data services. The LSS also ranks low in the second lowest quintile of the global ranking in the areas of data sources and data infrastructure, suggesting weaknesses in collection of censuses, surveys, administrative and geospatial data as well as the standards and methodologies for compiling statistics. Significant challenges remain in compilation and dissemination of economic and national accounts statistics. National accounts statistics currently published are insufficient to assess the performance of the economy. Data on government finance, public debt, and international investment positions are not regularly updated in the public domain. Insufficient commitment to dissemination and implementation of the Statistics Law to ensure data sharing between core statistics producers has been viewed as a key weakness. As a system, limited data sharing and integration have hindered evidence-based policymaking on cross-cutting issues. Development of the LSS has been driven by policy agendas and national development plans, which have been implemented and assessed at the sectoral level. Each ministry has the responsibility of compiling and disseminating its own statistical indicators for public consumption. There are governance issues with respect to data sharing and integration. The lack of an overarching data governance model has led to fragmentation in data standards and technical solutions for data sharing, which hinders data interoperability across different sectors and affects the possibility of integrating data to inform policies on cross-cutting issues. The lack of data integration has resulted in an underutilization of administrative data collected by line ministries and, compounded with weak data dissemination, has undermined the value of the LSS’s products. While LSB has played a role of the LSS coordinator with some degree of success, there is scope to further strengthen the LSB’s capacity to lead the system and produce the desired outcomes.The proposed project aims at improving the capacity of the LSS to produce and disseminate good quality statistics in a timely manner and to enhance use of key statistics. The project is closely aligned with the FY2022 – 2026 World Bank Group Country Partnership Framework (CPF) in strengthening governance and institutions. It is also aligned with the 9th National Socio-Economic Development Plan 2021 – 2025 through its direct support to the monitoring and evaluation (M&E) framework, and the Sustainable Development of the National Statistical System 2016-2025 and Vision by 2030 in Laos. Lastly, the project will contribute to monitoring progress toward the Sustainable Development Goals, implementation of the Government of Laos’ National Action Plan for Gender Equality 2021-2025, and the World Bank corporate commitments including climate change, gender, and citizen engagement. To achieve the PDO and support the modernization process of the LSS, the project will focus on four components: Component 1: Improving availability and quality of statistics. The objective of this component is to improve the availability and quality of key statistics that meet international standards. Improving availability means adding new statistical products and increasing the frequency of existing statistics while enhancing quality means improving the accuracy, reliability, relevance, and timeliness of statistics. These will be achieved by an improvement in collection of administrative, census and survey data as well as data compilation methodologies. In particular, the project will finance technical assistance to improve the compilation and survey methodologies and finance survey implementation including consultancy for survey design, software, enumerator trainings and compensation, transportation, technical assistance and capacity building for data analysis and reporting, and publications. This component will support statistics produced by LSB and the statistical centers of line ministries or equivalent agencies under the LSB’s technical guidance. It is made up of two subcomponents: i) Economic statistics; and ii) Social statistics. Component 2: Enhancing use of statistics. The objective of this component is to enhance the use of statistics produced by the LSS through data integration and dissemination. This component also lays the groundwork for the modernization of LSB and the LSS through piloting data integration and making an investment in an early development of the four pillars for a data governance and management architecture: i) standards and protocols; ii) data management team; iii) ICT infrastructure; and iv) data literacy. This component operationalizes the 2017 Statistics Law that assigns LSB the responsibility to provide quality assurance and technical endorsement to statistics produced by the LSS, as well as to collect, consolidate, and request statistics from the line ministries and to disseminate them at the national level. It is made up of three subcomponents: i) Data integration; ii) Data dissemination; and iii) ICT infrastructure. Component 3: Strengthening institution