Is Laos Ready to Graduate?
Issue 24 — Key Developments Across Cambodia, Laos, Myanmar, and Thailand
Editor’s Note
by Mattia Peroni, Lead Editor - Mekong Belt Desk
The Mekong is a region where progress rarely moves in a straight line. It advances in surges, stalls under familiar burdens, then—often unexpectedly—finds new momentum. That is the case for Laos, whose new national development plan, being drafted ahead of the country’s graduation from Least Developed Country status, reveals bold ambitions. However, the question is no longer whether Laos can grow—but whether it can do so steadily, fairly, and without slipping backwards due to fragile institutions. On the other hand, digital darkness is thickening again in Myanmar, as nationwide internet slowdowns, officially attributed to cable damage but suspiciously prolonged, arrive just as the junta pushes toward a widely rejected election. Meanwhile, Thailand and Cambodia are grappling with a debt burden that has quietly grown into a threat to long-term stability. In Thailand, the government aims to tackle the issue through a state-backed company that will buy back households’ debts and offer temporary credit reset. Cambodia shows a parallel strain: families are borrowing more just to get by, while small businesses retreat amid tightening liquidity. With non-performing loans rising in both countries, the region enters 2026 carrying the same warning—borrowing is growing fastest where resilience is weakest.
Lao PDR 🇱🇦
Will the 10th NSEDP Turn Lao PDR’s Progress into Lasting Inclusion?
by Thipphavanh Virakhom, in Vientiane
Laos is entering a decisive moment in its national development path. This momentum, built over five decades since independence in 1975, coincides with the end of the 9th National Socio-Economic Development Plan (2021-2025) and the drafting of the 10th NSEDP (2026-2030). This transition also coincides with Laos’ anticipated graduation from Least Developed Country status in 2026 — a milestone that brings both pride and significant pressure.
During the Second World Summit for Social Development held in Doha from 4–6 November 2025, Deputy Prime Minister Saluemxay Kommait reaffirmed the government’s commitment to inclusive, people-centered development. His remarks underscored strong political intent at a moment when the 10th NSEDP is still taking shape, particularly during the 10th Ordinary Session of the National Assembly held from 10–21 November 2025. Yet, despite clear commitments at home and abroad, a central question lingers: can Laos translate its ambitions into sustainable, equitable, and resilient development?
The country’s long-term achievements most prominently include the reduction of poverty from roughly 46% in 1993 to about 17% in 2023, a major social success. However, that progress demands deeper interpretation. A lower poverty rate does not automatically guarantee resilience nor resolve patterns of inequality or vulnerability among women, children, people with disabilities, and marginalized communities. The progress has been notable yet non-linear, and gains could stall or reverse if structural weaknesses persist.
These weaknesses are evident in the economic landscape. Although GDP grew by 4.1% in 2024, driven by tourism, electricity exports, mining, agriculture, and services, recovery is clouded by macroeconomic instability. The Kip depreciated by about 31% against the US dollar in 2023, fueling inflation of 25–30% and eroding household purchasing power. Meanwhile, public and publicly guaranteed debt — estimated at roughly 108% of GDP — constrains fiscal space for essential spending on health, education, and social protection. These pressures challenge Laos’ efforts to meet its commitments under the 2030 Agenda for Sustainable Development, where progress on poverty reduction, education, inequality, and climate action remains fragile.
Looking ahead, the 10th NSEDP sets ambitious goals: at least 5% annual GDP growth from 2026 to 2030 and mobilizing 523,504 billion Kip, equal to around USD 24 billion, in investment. The plan emphasizes building an independent, resilient, green, and sustainable economy, while also aligning with ASEAN Vision 2045 — which prioritizes connectivity, digital transformation, sustainability, and a people-centered regional future. This alignment signals Laos’ intention to pursue domestic reform while strengthening its role in a rapidly changing regional economy.
Yet core concerns remain unresolved. Will the transition from LDC status heighten vulnerabilities? Can inclusive development commitments become lasting institutional reforms? Will the NSEDP address critical financing gaps, debt pressures, and weak institutions in time to prevent regression?
Over the next five years, several indicators will be critical to watch: human capital investment, fiscal and debt sustainability, expansion of social protection, MSME development and job creation, climate resilience and disaster preparedness, and digital transformation. These areas will ultimately determine whether Laos’ hard-won progress becomes truly inclusive and enduring — or remains at risk as the country enters its next phase of development.
Thipphavanh holds a bachelor’s degree in international affairs. She is a governance and development professional specialising in rule of law, access to justice, and gender equality in Lao PDR. Her work focuses on strengthening justice sector institutions, advancing people-centred governance, and promoting gender-responsive systems. With extensive experience in project coordination, monitoring and evaluation, stakeholder engagement, and strategic communications, she has collaborated closely with national institutions and international partners to support inclusive and sustainable development.
Myanmar 🇲🇲
Myanmar Encounters Massive Internet Slowdown and Service Interruptions Amidst Rising Digital Controls
by Mozart
Since November 1, 2025, Myanmar has experienced severe internet slowdowns and repeated service cuts, disrupting connectivity nationwide and raising concerns over digital freedom, economic stability, and public safety.
The country’s internet infrastructure has been hit by both technical disruptions and government-imposed restrictions. Since early November, users across multiple regions have reported drastic drops in internet speed and frequent outages affecting households, businesses, and essential daily communications. Although both fibre-based broadband and mobile networks have been affected by undersea cable damage near Yangon, the unusually prolonged slowdown — lasting more than a week — has raised public suspicion. The pattern mirrors previous instances in which the ruling junta has throttled or cut connectivity to suppress dissent.
The Cybersecurity Law, enacted in July 2025, grants the military sweeping authority to monitor and restrict online activity, enabling shutdowns and bandwidth throttling under broad justifications of “peace” and “security.” Since the 2021 coup, the junta has repeatedly imposed nationwide and regional shutdowns, blocked social media and VPNs, and intensified internet and phone blackouts in conflict zones such as Rakhine and Kachin. These restrictions coincide with attacks on telecom infrastructure by resistance groups, natural disasters, and escalating state censorship — further isolating Myanmar from regional and global information flows.
This slowdown not only disrupts the daily life of the citizens, but also threatens the broader economic landscape by limiting access to markets and information which are vital for investors, businesses, and policymakers monitoring the evolving dynamics of Southeast Asia. Public suspicion has also grown that the prolonged slowdown is being deliberately maintained to obstruct online mobilization ahead of the junta’s planned general election between December 2025 and January 2026. The military’s push for an election has been heavily criticized on social media, and pro-election figures have faced boycotts. Limiting internet speeds may thus be serving a political purpose: curbing the spread of information and dissent during a highly contested period.
Myanmar’s internet crisis reflects broader challenges in Southeast Asian digital governance, but in this case, these pressures are amplified by the junta’s determination to tighten control while preserving political advantage. Without institutional reforms, continued digital isolation risks weakening the country’s economic recovery and further distancing Myanmar from regional integration efforts.
Ultimately, the ongoing restrictions highlight not only the fragility of Myanmar’s digital resilience but also the urgent need for transparent, accountable management of the country’s information networks.
Mozart is a research assistant at Mosaic Myanmar and is currently pursuing a Bachelor of Arts in Liberal Arts and Sciences at Parami University. His academic and professional interests span community development, minority issues, and social impact research. He has held roles including service-learning intern, student mentor, and operations coordinator for local initiatives, supporting project management, monitoring and evaluation, and education programs in Myanmar.
Thailand 🇹🇭
Thailand Deploys State-Backed AMC to Tackle Record Household Debt
by Satid Sootipunya, in Bangkok
Household debt has become a shared concern among several ASEAN economies, with Thailand ranking first for the highest household debt-to-GDP ratio in the region, with a staggering 88.2%. According to the National Statistics Office, the average Thai household carries 114,871 baht (USD 3,558) in debt, driven primarily by consumer goods (39.6%) and housing-related borrowing (34.7%).
Driven largely by consumption spending, such as credit-card borrowing, Thailand’s household debt is considered unhealthy because most of it is non-productive. This type of debt does not generate returns for borrowers, meaning they must repay the full amount without any income offset. Critically, many households are increasingly struggling to meet their repayment obligations due to relatively low incomes and sluggish financial climate.
In the second quarter of this year, non-performing loans (NPLs) accounted for 2.91% of total loans. While consumption-related NPLs declined across major categories, analysts note that this improvement was largely the result of a credit crunch: financial institutions are tightening lending due to Thailand’s weak economic outlook, rather than borrowers becoming more capable of repaying their debts.
Amid weak consumer spending—driven by the domestic debt crisis and exacerbated by U.S. tariffs introduced—the IMF expects Thailand to grow by only 2.1% in 2025 and 1.6% in 2026, placing the country near the bottom of the ASEAN growth rankings.
To address Thailand’s household debt problem and support sustainable economic growth, the Bank of Thailand (BOT), the Ministry of Finance, and major financial institutions have introduced a key solution: the state-backed Asset Management Company (AMC). Under BOT regulations, the AMC will purchase NPLs from commercial banks, financial groups, and state-owned specialized financial institutions (SFIs). Their objective is to restructure and convert these NPLs back into performing loans, which can help improve the debt situation in Thailand and generate financial returns for the AMC.
By purchasing debts from banks or other financial institutions, the AMC can help consolidate borrowers’ obligations by various means, such as cutting interest and principal, or extending the maturity date. Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas announced that the scheme will cost 10 billion baht (USD 300 million). Funding will be drawn from the Financial Institutions Development Fund (FIDF)—which currently holds around 26 billion baht (USD 790 million)—a BOT-administered fund designed to safeguard financial stability and support troubled institutions.
The debt-relief scheme is expected to support 3.4 million borrowers, covering NPLs of up to 100,000 baht (USD 3,000) per person. In total, the program aims to absorb 4.76 million NPL accounts worth 122 billion baht (USD 3.7 billion). Crucially, individuals who enter the program will have their credit histories reset, enabling them to regain access to formal credit within one to six months.
In this context, the AMC may ease immediate pressures on indebted households, but its long-term impact will depend on whether Thailand can pair debt relief with broader reforms to strengthen incomes, regulate lending, and revive economic momentum.
Satid is a multimedia economic journalist and news anchor who covers macroeconomic trends, Thailand’s fiscal policy, and key regional developments for Bangkok Biz. A Journalism graduate from Thammasat University, he has reported on major issues such as the US–China trade tensions, the Myanmar crisis, and global corporate stories, drawing on prior newsroom experience at The Momentum, the Bangkok Post, AFP, and Varasarn Press. His work blends economic analysis, foreign affairs, and digital storytelling, with a strong focus on making complex financial and political topics accessible to Thai audiences.
Cambodia 🇰🇭
Cambodian Households Are Borrowing More While Small Businesses Pull Back
by Sokna Thea, in Phnom Penh
Cambodia’s credit landscape in 2025 presents a mixed picture. On the one hand, households are borrowing again, often through personal loans and credit cards, despite income growth remaining weak. Small businesses, meanwhile, are holding back, weighed down by tight liquidity and increasingly cautious lenders. People borrow more to survive, while businesses borrow less to expand. If employment or remittances decline in 2026, loan defaults could rise sharply, which would be challenging for both lenders and the broader economy, as the non-performing loan (NPL) ratio is already high, having risen from 5.4% in 2023 to 7% in 2024.
The financial strain begins at home. The average Cambodian household has 4.3 members, but its income remains relatively low. According to the 2023 Cambodia Socio-Economic Survey, monthly household income averaged 2.58 million riels (approx. USD 645), while consumption averaged 2.10 million riels (approx. USD 522). Nearly 45% of spending goes to food, and another 21.5% to housing, water, and electricity. With margins this thin, even a small loan can become a heavy burden.
Yet households continue to borrow, largely because their income is not enough to cover basic living costs. Of Cambodia’s 2.32 million retail loan accounts, nearly 40% involve borrowers holding multiple loans across personal finance, credit cards, and mortgages. Almost 30% of borrowers have loans from more than one financial institution. These patterns typically point to financial stress, not confidence.
Many households now rely on borrowed cash to cover everyday expenses or smooth unstable incomes. Remittances and informal work have not fully recovered since the COVID-19 pandemic, and many Cambodian migrant workers have returned from Thailand due to ongoing border tensions. Debt is rising just as job prospects remain fragile—and with NPLs already increasing, households have become the most vulnerable segment heading into 2026.
Small businesses tell a different story. Small business credit applications fell in early 2025, and although there was a rebound in Q3, overall activity remains weak. Many approved loans are simply renewals or extensions, not new financing for expansion. Outside Phnom Penh, the slowdown is even sharper. Liquidity is tight, and lenders are cautious. This has stalled local trade and job creation, while at the same time, households continue to borrow more to keep up their spending.
If employment or remittances weaken in 2026, households may struggle to repay, just as small firms need working capital to survive. This would pressure banks from two fronts: rising consumer risk and stagnant business lending. This pattern is not unique to Cambodia. Thailand, Laos, and other ASEAN economies are also seeing household debt rise faster than income, and SMEs delaying investment.
At the moment, Cambodian households are borrowing because they must. Small businesses are borrowing less because they cannot. And the space between these two trends is where the next phase of financial risk may emerge.
Sokna has a background in International Affairs and Business & Commercial Law. He’s currently a Senior Project Coordinator at the Ministry of Economy and Finance of Cambodia, working on the Financial Management Information System (FMIS) Project. His professional focus is driven by entrepreneurship, business development, and financial technology, with a particular interest in how private-sector innovation drives Cambodia’s economic growth.
Editorial Deadline 14/11/2025 11:59 PM (UTC +8)
What if lasting inclusion remain an unfulfilled promise?
The Thailand AMC approach is intresting, but I wonder if debt relief alone can fix the underlying issue. If houseolds are still borrowing for consumption rather than productive investments, won't the problem just cycle back? The 88.2% debt to GDP ratio is alarming. Maybe the focus should be on income growth and financial literacy alongside debt restructuring.