Historical background

As elsewhere in the region, Lao crafts emerged primarily as an expression of the ritual or functional needs of rural society, although state intervention began at an early date with the commissioning of high-quality craft items for the Lao royal courts and temples.
In marked contrast to the situation in neighbouring Việt Nam and Cambodia, the French colonial government made little effort to exploit the Lao craft sector for economic purposes. Prince Phetsarath's School of Arts, which operated between 1932 and 1936 at Vientiane's
Wat Chanthaburi (Wat Chan), was intended primarily to raise the standards of craftsmanship amongst the Buddhist
sangha. Meanwhile French expatriate artist Marc Leguay, who opened a private art school in the Khong District of Champassak Province in 1940, would appear to have been motivated by the desire to nurture indigenous creative talent and at the same time provide an additional source of livelihood to individuals in that region.

Following the establishment of the National School of Fine Arts (now the
National Faculty of Fine Arts) in 1959, the Royal Lao Government introduced a number of initiatives to develop the craft sector for both domestic and foreign markets. However, by 1975 craft products were still not contributing significantly to the country's foreign trade.
Between 1975 and 1985 Laos was effectively closed to world markets and craft items were once more produced mostly for domestic or community usage. However, with the advent of the New Economic Mechanism (NEM) after 1986, an increasing number of both state and private craft enterprises were set up and there began a steady shift back to market production. Since the establishment of the
Department of Handicrafts of the Ministry of Industry and Handicrafts in 1999 and the Lao Handicraft Group (now the
Lao Handicraft Association) in 2001 there has been a more sustained effort to target foreign markets, with annual trade fairs to promote Lao crafts both at home and abroad.

At the time of writing there are just over 26,000 registered small handicraft businesses in Laos. Lao craft production currently accounts for just under 15 per cent of total industrial output, and the government is seeking to increase this.
The importance of the handicrafts sector to the Lao economy is illustrated by the fact that when an industry and handicraft exhibition is held around 80-90 per cent of the products on display are handicrafts. Textiles currently make up the largest single area of all Lao craft production.