The Lao government has set a target of achieving an annual economic growth of at least 5 percent from 2026 to 2030, as the economy shows signs of recovery despite ongoing challenges and global economic fluctuations.

This target is outlined in the draft 10th five-year national socio-economic development plan for 2026-2030, reflecting the Lao government's confidence in the nation's economic recovery, Lao News Agency reported on Thursday.

After years of economic hardship caused by domestic challenges, the COVID-19 pandemic, natural disasters, and global conflicts, Laos has seen several economic indicators pointing to recovery.

In May 2025, inflation dropped to 8.3 percent, marking the first single-digit rate since May 2022. Additionally, improved revenues, growth in agriculture, processing, and mining, along with a rebound in tourism and rising exports and services, are all positive signs of further economic recovery.

The Lao government aims to reduce inflation further and has outlined key growth drivers for the next five years, including energy, agriculture, mining, logistics, tourism, industrial processing, and the digital economy.

The government also plans to diversify its energy sources by exploring nuclear power, in addition to expanding hydropower, wind, solar, and biomass energy. This strategy is designed to ensure a reliable domestic energy supply while creating opportunities for export.

The plan also prioritizes infrastructure development, including transport links with China and Vietnam, and new railways connecting Vientiane to seaports in Vietnam and Cambodia, aimed at boosting industry and tourism. The government is also focusing on enhancing digital infrastructure and improving public services to drive the digital economy and support growth.

In addition, the draft plan calls for increased investment in human resources to improve education and reduce dropout rates.

The plan aims to accelerate the development of an independent, self-reliant economy, promote green and sustainable growth, and guide Laos toward graduating from least developed country status by 2026.