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Economy

Laos shifts to China equity from loans as party congress starts

Beijing's communist sibling pushed to salvage state enterprises amid pandemic

Laotian Prime Minister Thongloun Sisoulith, left, and Chinese President Xi Jinping at the Great Hall of the People in Beijing last year. China is Laos' largest lender.   © Reuters

BANGKOK -- Laotian Prime Minister Thongloun Sisoulith has signaled a change in tack to slow the communist-ruled country's slide toward defaulting on its foreign debts: securing foreign financing through equity rather than more loans, the largest source of which has been China.

Thongloun's cue, unveiled at a recent meeting of apparatchiks, came on the eve of the quinquennial national party congress of the Laos People's Revolutionary Party. The LPRP, which has ruled the landlocked, impoverished country with an iron grip, is expected to flag the direction of the country for the next five years during its sessions from Wednesday through Friday in Vientiane, the capital.

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