The Reform for Secured Transactions Regime with the Doing Business Indicator: A Case of Laos

Abstract

Abstract The IFC, a member of the World Bank Group, intervened to recommend strongly that Laos adopt a system of computerized registration of secured transactions for movable assets into a new Civil Code. Central to the IFC’s preference for its digital system was the assertion that it would immediately raise Laos’ ranking in the Doing Business indicator prepared by the World Bank Group. A higher ranking would, in turn, significantly increase the amount of inward foreign investment in Laos. This article examines the issues raised by the IFC’s involvement in two categories. The first part focuses on concerns about the substance of the IFC’s interventions, namely the fact that the IFC paid little attention to Lao legal tradition, implementation, and social reality. The second part focuses on the reform process and the fact that the IFC placed undue pressure on the government to adopt its favored approach.