Notice

Memorandum of Understanding between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Lao People’s Democratic Republic on Green Economy Framework

Published 2 August 2024

The Government of the United Kingdom of Great Britain and Northern Ireland and the Government of The Lao People’s Democratic Republic (the “Participants”).

Recognising that striving to address climate change and its adverse effects are common concerns of humankind that require urgent and collective action.

Reaffirming respective obligations under the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement, as well as their commitments to their respective decarbonisation goals.

Emphasising the importance of implementation of the UNFCCC and the Paris Agreement, which will play a key role in guiding the Participants’ cooperative efforts to effectively address the challenges of climate change.

1. Objectives

1.1 The purpose of this Memorandum of Understanding is to formalise bilateral cooperation to promote decarbonisation of economic activities of mutual interest that will support climate-risk based decision making, job creation and strengthen community resilience. In doing so, the Participants will build on robust economic relationship underpinned by ASEAN/UK Plan of Action.

2. Areas of Cooperation

In order to achieve the purpose of this Memorandum of Understanding, the areas of cooperation under this Memorandum of Understanding may include the following:

2.1. The Participants recognise the opportunities and challenges arising from decarbonisation and enabling the green economy, and the important role these issues have in enhancing energy security, economic growth and emissions reduction. The Participants also recognise the importance of upholding open, connected and rules-based markets in the green economy. The Participants will cooperate in the areas set out under the following Pillars. These are areas of initial interest and may be expanded if the Participants jointly decide to do so.

a) Pillar 1: Energy Transition

i. Technical assistance and capacity building support to define processes, policies and plans required to deliver NDC goals, NAP, LT-LEDS. 

ii. Under Lao PDR’s ASEAN Chairmanship, supporting development of policy, regulatory and technical aspects of grid interconnection, cross-border electricity trade and solutions to improve system resiliency and flexibility to help realise Lao’s aim to be ASEAN’s battery.

iii. Support on national level energy transition roadmap including masterplan for floating solar.

iv. Development of certification, standards and wider regulations to support the growth of the green ammonia/hydrogen economy.

v. Improving efficiencies in energy systems and the way energy is moved and consumed including demand management.

vi. Sharing best practices on circular economy principles for Lao PDR to achieve Net Zero.

b) Pillar 2: Adaptation & Resilience

i. Build capacity of policy makers, vulnerable communities and financial institutions to integrate climate resilience into government-wide policy planning to support integration of climate related risks into investment decisions.

ii. Integrating Nature-Based Solutions (NBS) into planning and development to achieve climate goals, including integrated water resource management (IWRM), integrated river basin management development and planning, flood and drought mitigation and management and supporting critical ecosystems in terrestrial and wetland conservation.

iii. Ground water surveying, planning, quality and resource modelling, network development and management.

iv. Strengthening hydro-met services including weather forecasting, climate projection modelling and early warning system, flood and drought mapping.

v. Sharing best practices on sustainable agriculture to improve rural livelihood, strengthen food security and supply chain. 

vi. Protection of forest and biodiversity to promote sustainable growth through transparent and accountable mechanism.

c) Pillar 3: Carbon Markets and Sustainable Finance

i. Strengthen the enabling environment to increase access to climate finance flows (including the new Loss and Damage Fund as its independent decisions on eligibility permit) through capacity building, supporting the development of greener financial systems including policy coordination, reporting and disclosures, climate budgeting, project structuring, and designing innovative financial instruments.

ii. Cooperation to support the design, pilot, and implementation of high integrity Carbon Pricing Instruments aligned with Lao PDR’s development priorities.

iii. Improving access to voluntary and international carbon markets.

iv. Capacity building programmes to develop and advance climate action and ambition through high-integrity international carbon markets.

v. Assisting Lao PDR to sign up to multilateral Emissions Reductions Payment Agreements to incentivise actions to enhance forest carbon stocks.

d) Pillar 4: Urban Planning and Green Transport

i. Capacity building and knowledge sharing on creating strategies, policies and regulatory frameworks for zero emission vehicles as well as mobilising public and private finance towards charging infrastructure.

ii. Strengthening the enabling environment to promote and raise green construction standards at country level and supporting access to concessional investment finance and technical assistance for certified energy efficient green buildings.

iii. Supporting technical capacity and leadership in prioritising, developing, implementing and managing low-carbon and climate-resilient infrastructure projects, plans and policies.

iv. Supporting technical capacity in integrating land use planning with transport infrastructure.

v. Studies, planning and development of wastewater treatment systems and sanitation circular economy approaches for urban areas, and strengthening air quality monitoring.

2.2. In addition to the above Pillars, the Participants will explore activities that support collaboration between governments, academia and the business community. This includes activities, such as (but not limited to) information exchanges, and dialogues on technical regulations, collaborations on standards development and adoption of internationally-recognised standards, mutual recognition of conformity assessment procedures in relation to the green economy, enterprise matching for business and co-innovation, green capability development for small and medium sized enterprises, academic and research partnerships, pilot projects, and outreach and promotion. These activities will be set out in the Work Plan (see paragraph 4.3) and updated annually.

3. Involvement in implementation

Key agencies involved in the implementation of this Memorandum of Understanding include:

United Kingdom: Foreign, Commonwealth and Development Office (FCDO), the Department for Energy Security and Net Zero (DESNZ), Department for Environment Food and Rural Affairs (DEFRA), Met Office, and Department for Business and Trade (DBT).

Lao PDR: Ministry of Natural Resources and Environment (MONRE), Ministry of Energy and Mines (MEM), Ministry of Agriculture and Forestry (MAF), Ministry of Public Works and Transport (MPWT) and Ministry of Finance.  

Where appropriate, the Participants may also involve industry partners, academia or other government agencies.

4. Governance and working arrangements

4.1. A Joint Steering Committee (the “Steering Committee”) will be formed to oversee the implementation of this Memorandum of Understanding, co-chaired by the Director General from the Ministry of Natural Resources and Environment and the Deputy Ambassador to Lao PDR.

4.2. The Steering Committee will meet bi-annually or at such other intervals as the Participants may jointly decide. Meetings may be held in person or virtually, with the format being jointly decided by the Participants on a case-by-case basis.

4.3. The Participants will develop a Work Plan (the “Work Plan”) to set out priority activities and objectives under each Pillar, including the initial areas set out in paragraphs 2.1a) to 2.1d). Working Groups comprising relevant officials across each area of cooperation from the Participants will be responsible for developing and implementing the Work Plan.

4.4. The Steering Committee will review the Work Plan bi-annually and, if necessary, update it to include any new priorities (including the addition of new areas of cooperation). The Working Groups will lead on implementation according to the Work Plan. In addition, there will be ongoing consultations between the Participants and business and academia.

5. Other matters

5.1. This Memorandum of Understanding serves as a record of the Participants’ understanding, and does not create legally binding obligations between the Participants or between either Participants and any third party.

5.2. Unless otherwise jointly decided, the Participants will settle any difference or dispute relating to or arising from this Memorandum of Understanding amicably through consultations and negotiations in good faith between the Participants.

5.3. Nothing in this Memorandum of Understanding will be interpreted or implemented in a manner that is contrary to, or inconsistent with, the respective international obligations and domestic laws and regulations of the Participants.

5.4. Each Participants will bear its own costs and expenditures incurred in the course of implementing this Memorandum of Understanding. The activities of each Participants in connection with this Memorandum of Understanding are subject to the laws and regulations that govern that Participants.

5.5. Participants recognise that to facilitate the objectives of this Memorandum of Understanding, information may pass between them. The sharing of information pursuant to this Memorandum of Understanding is subject to the following provisions:

a. A Participants may only use information received from the other Participants for purposes intended to further the objectives of this Memorandum of Understanding.

b. A Participants may only disclose information received from the other Participants to a third party if the Participants wishing to disclose the information seeks and obtains prior written consent from the other Participants, except in circumstances described in the subparagraph below.

c. In circumstances where a Participants is legally obliged to disclose any information received from the other Participants under applicable legislation, by court order or for another reason, it will inform the other Participants before doing so or, where that is not possible, as soon as possible after disclosing the information.

5.6. This Memorandum of Understanding will enter into effect on the date of signature and will remain in effect for a period of five (5) years, after which time it will be reviewed jointly by both Participants. 

5.7. This Memorandum of Understanding will remain in effect unless terminated by either Participants pursuant to paragraph 5.8, or if the Participants jointly decide in writing to terminate it, which they may do at any time.

5.8. Either Participants may give written notice to the other Participants to terminate this Memorandum of Understanding. This Memorandum of Understanding will be terminated three (3) months after such notice is received by the other Participants. The termination of this Memorandum of Understanding will not affect the validity, duration and completion of any activity undertaken pursuant to this Memorandum of Understanding prior to the date of termination unless otherwise decided by the Participants.

5.9. This Memorandum of Understanding may be amended at any time with the written consent of both Participants, and such amendments will come into effect on such date as decided by the Participants.

The foregoing record represents the understandings reached between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of The Lao People’s Democratic Republic upon the matters referred to therein.

Signed in duplicate on 26 July 2024 in English and Lao languages, both texts having equal validity. In case of any discrepancies under this Memorandum of Understanding, the English version shall prevail.

For the Foreign, Commonwealth, and Development Office of the United Kingdom of Great Britain and Northern Ireland:

The Rt Hon David Lammy MP Secretary of State Foreign, Commonwealth and Development Affairs

For the Ministry of Foreign Affairs of the Lao Peoples Democratic Republic:

His Excellency Saleumxay Kommasith Deputy Prime Minister and Minister of Foreign Affairs