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Lao central bank vows to resolve spiraling inflation

VIENTIANE, May 31 (Xinhua) -- The Lao central bank is applying strict measures against high inflation rates, a severe shortage of fuel, and depreciation of the national currency kip.

To ease the situation, which is further exacerbated by the COVID-19 pandemic and some regional conflicts, the central bank is rolling out measures to tighten the management of money flow and ensure there is sufficient monetary circulation within the economy to maintain socio-economic development.

The central bank will further cooperate with the Ministry of Public Security and other government agencies to crack down on illegal foreign currency trading, which causes public distress and disturb the market, the local daily Vientiane Times on Tuesday quoted Governor Sonexay Sithphaxay as saying.

The central bank will strengthen the management of foreign currency and monetary supply mechanisms in relation to importing essential goods that can not be produced in Laos.

The most important and costly of these is fuel, which must be obtained in sufficient quantities to meet the needs of the public and enable the economy to function normally, Sonexay added.

In order to get sufficient foreign currency for fuel importers, the government is partnering with commercial banks to seek new sources of funds.

The government is also looking at improving the management of revenue sourced from other countries to bring in much more foreign currency, Sonexay said.