Laos Eyes Oil Trade, Refining Cooperation With Azerbaijan

(MENAFN- Trend News Agency) BAKU, Azerbaijan, October 14. Laos is exploring opportunities to cooperate with Azerbaijan on oil trade and, in the future, oil refining. The two countries also have potential for joint projects in agriculture, mining, transport and logistics, and tourism, Vanthana Nolintha, Permanent Secretary and member of the Standing Committee of Laos' Investment Promotion and Management Committee (IPMC), said at the Azerbaijan-Laos Business Forum in Baku on Wednesday, Trend 's correspondent reports from the event.

He noted that while Azerbaijan is one of the world's major oil exporters, Laos meets its entire oil demand through imports. In this regard, oil trade could become a promising area of economic cooperation between the two countries.

“Azerbaijan is one of the major oil exporters, while Laos imports 100% of its oil. This creates significant opportunities for oil trade in the future, as well as cooperation in oil refining at a later stage,” he said.

Vanthana Nolintha also outlined other promising areas for expanding cooperation between Azerbaijan and Laos. According to him, discussions between the two countries' economy ministers identified agriculture, mining, transport and logistics, and tourism as potential areas for cooperation.

The committee official said Laos has extensive areas of fertile land suitable for agricultural production and processing. Cooperation with Azerbaijani companies in this sector could help meet domestic demand and support exports to foreign markets.

Speaking about mining, Vanthana Nolintha noted that restrictions have been imposed on accepting investment applications for new mining projects in Laos. However, opportunities remain for foreign investors to cooperate with local companies holding existing licenses, particularly in raw material processing and the production of higher-value-added goods.

“We aim to move beyond raw material extraction toward processing and refining activities that generate greater added value. Azerbaijani companies can explore opportunities to cooperate with local enterprises in Laos that hold the relevant licenses,” he emphasized.

The committee official also said the two countries could benefit from each other's experience and capabilities in transport and logistics.

“Azerbaijan has the potential to become a transport and logistics hub in the region, while Laos has similar potential within ASEAN. Combining the financial resources and capital of the two countries could create new opportunities to expand ties and implement joint projects in this sector,” Vanthana Nolintha added.

According to him, tourism could also play an important role in developing Azerbaijan-Laos relations. Expanding tourism cooperation between the two countries could increase mutual tourist flows and strengthen people-to-people ties.

Vanthana Nolintha also said Laos intends to diversify its sources of imports. He noted that a significant share of the country's imports passes through Thailand, and exploring alternative supply sources could create additional opportunities for cooperation with Azerbaijan.

The committee official also highlighted several financial incentives Laos offers to attract foreign investors.

According to him, these incentives include profit tax exemptions for a specified period, reductions in land lease and licensing fees, customs duty exemptions, and a flat personal income tax rate of 5% for highly skilled foreign professionals.

He said investment incentives are directed toward priority sectors such as agriculture and agro-processing, healthcare, education, innovation, the digital economy, renewable energy, tourism, infrastructure, special economic zones, industrial parks, and transport and logistics.

Vanthana Nolintha noted that the level of incentives also depends on the location of a project. Projects implemented in rural and less-developed areas are eligible for longer tax exemption periods.

He also said negotiations are underway between Azerbaijan and Laos on a bilateral agreement on the promotion and protection of investments.

“We have submitted the draft agreement to the Azerbaijani side. We hope that formal negotiations can begin by the end of this year or early next year. This could further strengthen investment protection between the two countries,” he emphasized.

The committee official noted that Laos currently has 26 bilateral investment treaties, while negotiations on another three or four agreements are ongoing.

He added that exploring existing opportunities to expand trade and investment ties between Azerbaijan and Laos and strengthening economic cooperation between the two countries are important.

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