The World Bank has approved a second Enhancing Public Financial Management through Information and Communication Technology and Skills Project to support the Lao PDR’s efforts to better manage its public finances, the bank announced. The $17.5 million project, funded by a low-interest loan from the World Bank Group’s International Development Association, will allow the Ministry of Finance to develop clearer budget planning, implementation, and reporting across the government as a whole, making public spending more transparent and accountable. The initiative follows a first phase that began in 2019.
The project supports an integrated financial management information system and trains staff at spending units across all levels of government so they can prepare budgets and record activities within the state budget system. “Essentially, this means that all agencies or offices using the state budget will only spend money within the official system,” said Khwima Nthara, World Bank Country Manager for the Lao PDR. “This helps the government ensure transparency and accountability, so that Lao taxpayers get improved value for money, and will also facilitate timely decision-making.”
The project is part of the World Bank’s wider Public Financial Management program, which works with the Ministry of Finance to improve the use of public funds. Better public financial management means more effective and equitable delivery of public services, including education, healthcare, energy, transport, and law enforcement, to all Lao people. By centralizing budget spending within one official system, the government can track expenditures more accurately and prevent unauthorized spending.
The first phase of the project, launched in 2019, laid the groundwork for financial management system integration across government agencies. The second phase builds on this foundation by expanding training and technical capacity to more spending units at provincial and district levels. This approach aims to standardize financial reporting practices and improve the quality of budget data across the entire public sector.
Improved financial management systems also help the Lao PDR meet international standards for transparency and accountability, which can strengthen donor confidence and support the country’s broader development goals. The project represents a key step in modernizing the country’s public administration and ensuring that government resources reach the communities and services that need them most.
