Prime Minister Sonexay Siphandone and his Vietnamese counterpart Pham Minh Chinh (cenre) flanked by senior government officials, attend the launch of the new systems in Vientiane on Thursday. - Photo: Vientiane Times/ANN
VIENTIANE (Vientiane Times/ANN): The governments of Laos and Vietnam have initiated a cross-currency transaction service and cross-border payment system using QR code technology, to strengthen economic ties between the two nations.
The launch of the new systems took place in Vientiane on January 9 during the 47th meeting of the Laos-Vietnam Intergovernmental Committee.
Lao Prime Minister Dr Sonexay Siphandone, his Vietnamese counterpart Pham Minh Chinh, and senior government officials from the two countries witnessed the start of this milestone collaboration.
This initiative is in line with the goal of both governments to strengthen financial cooperation and reduce reliance on foreign currencies.
The two countries’ central banks, namely the Bank of the Lao PDR (BOL) and the State Bank of Vietnam, will partner to allow use of the Lao kip and the Vietnamese dong in cross-border payments.
The collaboration will enable businesses in both countries to conduct transactions in their respective local currencies and will reduce the demand for foreign currencies, thereby alleviating pressure on foreign currency reserves.
It will also make financial transactions easier for travellers.
The introduction of the cross-currency payment system underscores the commitment of the Lao and Vietnamese governments to foster deeper regional cooperation and promote the use of local currencies in trade.
In its initial phase, Vietnamese users can make QR code-based payments while in Laos. In the second phase, expected to be ready for roll out by the end of this year, Lao citizens will be able to use the QR code payment platform in Vietnam.
QR code payment connectivity is part of the Lao government’s wider plan to strengthen money transfer and payment systems with neighbouring countries, in particular Thailand, Vietnam, Cambodia and China.
Last month, Laos and China launched a QR code payment mechanism to enable cashless transactions for tourists as part of cross-border collaboration.
This followed on from the introduction of a cross-border QR payment link by Laos and Thailand in April last year, to support trade, investment, tourism, and broader economic activities.
In 2023, Laos and Cambodia also initiated a cross-border payment system that allows travellers to use their local currencies for transactions.
The value of trade between Vietnam and Laos reached new heights in 2024, with total trade turnover rising to US$2.2 billion, up nearly 34 percent year-on-year.
The Lao and Vietnamese governments have agreed to adopt robust and practical measures to further deepen their political and diplomatic relations, strengthen defence and security, and foster stronger economic ties.
Priority will also be given to improving the quality of education, with the Vietnamese government to provide 1,160 scholarships for Lao officials and other individuals to study in Vietnam, while sending teachers to Laos to teach the Vietnamese language.
Laos and Vietnam have a strong partnership in trade, tourism and other sectors, so the top priority is to initiate the cross-border use of local currencies.
The governors of the two countries’ central banks have vowed to jointly work on this initiative and will oversee widescale implementation of the scheme. - Vientiane Times/ANN
