Bank of the Lao sets 2026-2030 monetary plan targets for reserves, NPLs and inflation and prioritises stronger foreign-exchange management

The Governor of the Bank of the Lao briefed the National Assembly on banking-sector priorities linked to the next socio-economic development and monetary plans, and set three headline targets for the 2026–2030 monetary plan. These include foreign-exchange reserves covering five months of imports, a non-performing loans (NPLs) ratio not exceeding 3%, and average inflation of 5% (plus 2%). The briefing highlighted ongoing difficulties in enforcing foreign-exchange rules, citing strong demand to hold foreign currency to support trade and essential imports, widespread foreign-currency cash payments, and the need to bring more foreign currency into the banking system. The Bank plans to keep monitoring implementation of existing regulations, review and improve rules that are not well aligned or effective, and work with other authorities to address inflation drivers such as the exchange rate, fuel and electricity prices, transport costs and food prices through strengthened price-management mechanisms. To raise reserve cover to 5–6 months or more, the Bank pointed to strengthening the banking system to support confidence and attract foreign investment, promoting domestic production and exports to sustain external surpluses, developing an external-debt management strategy to reduce repayment pressures, and increasing the repatriation of foreign-currency receipts from exports, tourism and overseas workers into the banking system while reducing cash held outside it.