Formerly a French protectorate, Laos became independent under the Geneva Accords (20 July 1954), which put an end to the French colonization of Indo-China. After many years of armed struggle between Nationalist Marxist guerrillas and government forces, (supported by the USA), in 1975, the Lao People’s Revolutionary Party (LPRP) seized power, forced the king to abdicate and installed a socialist regime supported by Vietnam. In the north-west the pro-independence movement of the Hmong-mien is active.
According to the Constitution of 1991, Laos is formally a parliamentary republic but is actually a one-party regime. Legislative power lies in the hands of the National Assembly (149 members elected for five years) which elects the President of the Republic.

Economic growth, fuelled by the export of hydroelectric energy and by the construction and manufacturing sectors, began to recover in 2021 from the effects of natural disasters occurred in 2019 and the COVID-19 pandemic. Most of the work-force is still employed in agriculture. Rice, the main crop, is grown on 60% of the farmland. The cultivation of commercial crops (such as coffee, maize, fruit, cotton and sesame) is relevant. The forests are widely exploited for various kinds of prized timber, especially teak. The country’s underground resources (especially iron, gold, copper and tin, as well as gypsum, coal, silver and zinc) are being exploited thanks to foreign capital. Electricity production (exported to Thailand) is on the increase and comes from numerous hydroelectric power plants in the Mekong basin.
Key industrial sectors include engineering (vehicle and motorcycle assembly), electronic components and the processing of timber, tobacco and cement. Craft-making activities are also practised on a wide scale (ceramics and earthenware). Tourism is increasing. The public accounts deficit is high and the trade budget is in the red: the country imports consumer goods, machinery and fuels; it exports electricity, coffee, timber, copper and gold. Its main trading partners are Thailand and China. The Banque d’État de la RDP Lao acts as the central bank. Several foreign commercial banks operate in the country. There is a stock exchange in Vientiane (since 2011).

A train line between Kunming (China) and Vientiane is under construction, as well as another one connecting with Vietnam. The River Mekong and its tributaries are used extensively as a vital means of communication.