VIENTIANE, LAOS: A group of Japanese investors want the Lao government to develop a bio-diesel policy and build new infrastructure to attract foreign investment, according to a senior energy official.

Director General of the Energy Department of Ministry of Energy and Mining, Vilaphone Vilavong, said on Thursday (15 Nov) that the Japanese entrepreneurs had indicated to him that they were interested in investing in bio-diesel production in Laos, but would first require more established guidelines for the industry before making investment decisions.

The investors know that Laos has significant bio-diesel potential, but they need to know more about government policy on the sector.

“In many countries, including the US, the government offers tax exemptions on bio-diesel, to encourage investors to develop this new source of energy,” he said.

Vilaphone told Vientiane Times that the Japanese investors also wanted the government to develop more infrastructure for the bio-diesel industry, such as roads leading to plantations of the fuel's main raw materials, and modern factories with technical experts.

"The investors were adamant that every government must invest in infrastructure first, to initiate bio-diesel investment. This must be the incentive for investors to initiate projects and carry on by themselves," he said.

The investment in the production of bio-diesel was considered expensive compared to oil drilling, which only requires the installation of machinery.

Vilaphone said this energy source had a bright future; while oil deposits are slowly being depleted, it is now necessary for governments around the world to find alternative sources of energy.

“Once all the oil has been used, people will have no choice but to use bio-diesel instead,” he said.

Vilaphone said the Japanese investors told him that if the Lao government did not have enough funds to develop its policy and infrastructure, it could request assistance from the Japan International Cooperation Agency (JICA) in Laos .

The agency has a policy of assisting countries worldwide in finding alternative sources of energy, and would be interested in helping Laos in this quest, he said. (By EKAPHONE PHOUTHONESY/ The Vientiane Times/ ANN)