LAO/338
Local development programme (LDP)

The expected outcome of the LAO/338 Local development programme (LDP) is “the well-being of Lao people is improved, leaving no one behind”. This reflects the priorities of the Lao government’s 9th National Socio-Economic Development Plan 2021-2025 as well as the goals of the Lao-Luxembourg Indicative Cooperation Programme V (ICP V) and the Swiss Agency for Development and Cooperation’s (SDC) Cooperation Programme for the Mekong Region (2022-2025), who are jointly funding the programme.

The Local development programme will build on the strong working relationships that have been established under its predecessor LAO/030 with the Ministry of Planning and Investment, particularly the Department of Planning, and its line agencies within the four target provinces. It will continue to foster participatory planning and channel programme resources into realising priorities at the district and village level. Its focus on capacity development at national but primarily at sub-national levels will assist central, provincial, district and village authorities to improve public services for the benefit of local communities. By improving capacity at all levels and engaging in policy dialogue, LDP intends to mitigate some of the threats facing rural communities in Lao PDR, which include land tenure insecurity, deforestation and low education outcomes. 

The total budget is 33 930 000 EUR over the five-year period 2023-2027. While strengthening the capacity of relevant central agencies, LDP will focus on the poorest villages and districts in the provinces of Bokeo, Vientiane, Bolikhamxay and Khammouane, and will expand operations to cover approximately 20 districts and 315 villages.

To meet the outcome mentioned above, LDP used a Theory of Change process to identify three intermediate changes with priority areas of intervention as follows:

• social-economic opportunities for sustainable livelihood are created for Lao people, leaving no one behind will focus on creating productive farming opportunities (whether commercial or subsistence) for men and women. This intermediate changes also encompasses interventions in nutrition and health, land tenure security and climate change adaptation, inclusive finance, cooperation with the private sector to improve market access and capacity development support for enhanced farming/business skills. Partnerships will be maintained with two Luxembourg based non-governmental organizations, being ADA (specialising in inclusive finance) and Caritas (specialising in community development) as well as locally based non-profit associations;
• Lao people have access to improved and more resilient public services including infrastructure provided by district authorities will introduce a District Annual Financing Window, through which target districts (with provincial support and under provincial supervision) will receive a secure budget envelope based on a number of criteria including population size to implement prioritised actions in the key areas of education, water, sanitation and hygiene and feeder roads in line with district development plans;
• Lao people have access to improved and more resilient village-level services will continue to support the participatory Village Development Planning process established under LAO/030 for identifying and prioritising village needs. This village plans will be supported with a Village Development Fund to meet community priorities in infrastructure rehabilitation/maintenance, credit and capacity development among others.

Actions to maximise the effectiveness and efficiency of LDP include:

• ensuring alignment with current and upcoming national strategies;
• using existing government guidelines and systems for procurement and monitoring;
• promoting local ownership through the activity prioritisation process at district and village level;
• collaborating with other donors to avoid duplication;
• adopting a flexible approach to budgeting to reward well performing villages and districts; and
• establishing robust monitoring and evaluation systems that allow for feedback and learning.