Area based production
Lowland production will be largely capital intensive, with the application of technologies to improve and maintain the quality of soils and guide the use of agricultural chemicals; use appropriate technology and equipment for mechanized production; and, apply climate change mitigation and adaptation measures. The low land /flatland areas also will be the focus of irrigated agricultural production to produce supplementary dry season rice to ensure food security and high value crops for value-added processing and export to regional and global markets. Entrepreneurial smallholder farmer organizations will be practicing irrigated agriculture in partnerships with agribusiness enterprises; in some locations as mega-projects. Irrigated agriculture projects will be organization bases on Irrigated Agriculture Development Plans (IADPs) prepared by local governments in consultation with communities, and incorporated into district and provincial socioeconomic development plans. The financing of irrigation development and rehabilitation will be in the form of partnerships between communities and interested private investors, with the Government playing a facilitating and coordinating role, while monitoring and evaluating policy implementation.
Up and highland agricultural production in the Northern and Southern regions will first and foremost aim to meet local food security needs. Livestock producers will raise cattle and buffalo both for domestic consumption and export, as well as small livestock and fish to meet local protein needs. Upland agricultural production will be more diversified to provide a greater range of food groups to meet the nutritional needs of local populations.
Contributions of the sector to overall national development
In the next 10 years, the Agriculture and Forestry Sector will continue to play a substantial (although gradually declining) role in achieving the expected overall economic growth. On plausible assumptions of a slower decline in public investment and slightly higher FDI and trade, agricultural value added is likely to grow at 4.2 percent per annum. For this growth rate to be maintained, public investment has to be larger by 3 percent. If fiscal constraints are less binding, a 20 percent higher public investment would lead to a growth rate of just under 5 percent. Recent analyses indicate that a 1 percent growth in agricultural value added will result in 1.6 percent growth of overall GDP. Agriculture will also remain a key driver of the poverty reduction process, notably by incorporating progressively a larger proportion of the smallholders into commercial agriculture.
In various forms of co-management, rural upland communities and the Government will be collaborating to manage natural resources that provide valuable environmental services to the Nation. Fiscal policy measures will be formulated that reward farmers as good eco-stewards to preserve watersheds, protect biodiversity, domesticate NTFPs, and conserve forests. On the basis of secure land titles, rural households and communities will continue to provide environmental services which will be re-valued and include adequate financial contributions from the beneficiaries of these services, among others hydropower and large scale irrigation schemes.
To this end, forests in watersheds will be preserved to ensure their integrity for sustained hydropower production. Biodiversity will be conserved for eco-tourism. NTFPs will be available for consumption to supplement food security and for sale as cash crops to niche markets to increase household income. Forests will be conserved to sequester carbon and allow participation in income-generating international carbon pools (e.g., REDD). A regulatory framework will e developed to allow the active participation in global financial markets and the trade with CO2 certificates and derivates. Each of these environmental services provides revenues to support the economic development and quality of life of the Lao Nation.