While the pandemic and Russia's invasion of Ukraine sent prices around the world spiralling, Laos has found itself incapable of putting the brakes on inflation. Prices rocketed 23 percent in 2022 and 31 percent last year, while they are on course for 25 percent this year, according to the Asian Development Bank (ADB).
Families in particular have been hit hard as the cost of basic staples such as rice, sugar, oil and chicken doubled last year. A growing number of households are so desperate for food that they are now having to forage to supplement their diets, according to a World Bank household survey earlier this year.
Despite three decades of consistent economic growth, Laos remains one of the poorest countries in Asia, with limited transport infrastructure and a low-skilled workforce mostly employed in agriculture. Life expectancy is just 69 years and the ADB says that nearly one in three children under five is stunted because of malnutrition -- one of the highest rates globally.
In recent years, the government has borrowed billions of dollars from neighbour China to fund a $6-billion high-speed railway and a series of major hydropower dams -- aiming to become the "battery" of Southeast Asia. The World Bank warned in a report last week that public debt -- over $13 billion, or 108 percent of GDP -- was "unsustainable".
Interest payments totalling $1.7 billion are due in 2024 and an average of $1.3 billion for the next three years, further eroding Laos' foreign exchange reserves.
A Chinese foreign ministry spokesman told AFP Beijing was doing "all it can to help Laos ease its debt burden". But Laotians can expect more pain in the short term, with the ADB predicting inflation will stay above 20 percent until the end of next year at least.