Summary：In the age of the Internet, it is hard to imagine a country without access to an online settlement system. However, Laos is such a country.If you want to set up a company in Laos and do international trade, you will find it difficult.
License：This work is licensed under a Creative Commons Attribution 4.0 International License.
In order to fulfill our commitment to ourselves: to promote the development of Laos’ pharmaceutical industry with IT technology, and to facilitate the progress of Laos’ economy and industry, we will disclose to the public the knowledge and experience accumulated by our company in the process of operation and development. For reference by others who need to conduct trade in Laos.
Laos’ international settlement system basically relies on swift and banks for bilateral trade between the two countries.
This payment and settlement system is completely built around the export of bulk raw materials such as ore and the import of daily necessities. The cumbersome counter procedures and the uncertain capital quota will bring you back to 20 years ago.
To make matters worse, it took us a month to process a bank card with a VISA logo before verifying that outgoing payments over the internet were restricted. Of course, the result is limited.
Now it is basically certain that if you want to open a merchant account in a system such as paypal or wise for receiving money, it is basically impossible in Laos.
At first we thought it was because Laos was on the sanctions list of the United Kingdom, the United States and Europe.But later we learned that the private banks here had access to third-party payment, but they stopped this business for some reason.
Well, if you are already doing business in Laos, now you have three options:
- Relying on the SWIFT system, but this traditional settlement method is very unfriendly to wholesale and retail businesses seeking efficiency.
- The use of cryptocurrencies for payment and receipt ultimately needs to be converted into a sovereign currency. Obviously, Laos does not have a good entrance.
- Setting up an offshore company in a free trade port area faces more complex tax and legal issues, and adds more costs.
None of the above looks like an ideal solution.
Well, in the process of this round of industrial chain migration from China to Southeast Asia and South Asia, the challenges encountered are a bit beyond our imagination. Various productivity factors and infrastructure do hinder the development of business, and also bring various difficulties and problems.
A shoe factory that recently settled in Laos complained about not being able to recruit qualified middle managers, but here, who isn’t?