The Laotian economy has been severely disrupted by years of war. About 80% of the labour force works in agriculture. The main crop is rice. Annual production depends heavily on weather conditions. Droughts are frequent and Laos sometimes has to depend on rice imported from Thailand to make up for shortfalls. Flooding and pests also affect production. Other crops include cucumbers, bananas, corn, sugar cane, papaya, tobacco, pumpkin, carrots, cassava and groundnuts. Farmers use ox-drawn ploughs to cultivate the land and for transportation.

 The government has relaxed its policy of creating collective farms. Today, families may cultivate individual plots of land, although a whole village will work together to plant and harvest rice crops. Many families supplement their income by raising pigs, water buffaloes, cows and poultry. Some fish in nearby rivers. On farms, men and women have separate tasks. Men fish, hunt, build canoes, repair tools and fishing gear, hunt and gather wood. Women are responsible for cooking, pounding rice, carrying water and wood, tending kitchen gardens, gathering berries, raising livestock, spinning, weaving and making clothes.

Some Hmong and Mien tribes, who live in the hill country of northern Laos, still grow opium, which is used to make heroin. The government is working to find substitute crops that will provide an alternative source of income for the people in this area.

 About two-thirds of Laos is covered with rich forests that contain rosewood, mahogany, ironwood, teak and pine. About 40% of Laos's exports are forest products. Many Laotian men work in the timber industry, but timber and forest products have declined in export value in recent years. 

Laos has valuable mineral deposits. They include tin, gypsum, potash, coal, lead, zinc, iron ore, limestone, copper, gold, silver and precious gems. Of these, only tin and gypsum are mined extensively. Several foreign companies are carrying out petroleum exploration in southern Laos.

 About 600 factories, producing clothing, soft drinks, cigarettes, bricks, cement and other items, make up Laos's manufacturing sector. Most are located near the capital, Vientiane. The source of power for much of this industry is hydroelectricity from the Nam Ngum dam, north of Vientiane. There is a small but growing tourist industry. Most tourists come from Thailand.

  Did you know?
Laos is a member of the Association of South-East Asian Nations (ASEAN), an economic organization that includes Thailand, Vietnam, Singapore, Indonesia, Malaysia, the Philippines and Brunei.