Developing a Sector-level Productivity Diagnostic Model through MFCA

Material flow cost accounting (MFCA) is a prominent productivity tool that focuses on tracing input materials, waste, emissions, and negative products. MFCA helps enhance an organization’s overall economic and environmental performance, which is a useful innovation in the kaizen approach. In this respect, DOSMEP plans to implement the Workshop on MFCA for Lao PDR’s agroprocessing and industry sectors to lead to a new model for promoting a more effective, enhanced version of MFCA and GP in the collaborative, wider ecosystem.
The project will be composed of two parts. First, a Workshop on MFCA will be conducted for participants from sectors in which SMEs are actively engaged, including agroprocessing, footwear, optical lenses, garments, and auto parts. The workshop will provide practical tools for and knowledge of MFCA, resource efficiency, and cleaner production at the process level while introducing GP concepts, environmental management, and circular economy practices within the MFCA framework. Second, a rapid assessment of selected SMEs will be undertaken to identify opportunities for consultancy support on ESG, sustainability, and the application of MFCA in preparation for the next phase of the project.
The activities are expected to strengthen the institutional capacity of DOSMEP and relevant government departments to support, monitor, and promote GP and sustainable manufacturing among SMEs. They will also enhance the capability of enterprises to transform their existing operations toward greater sustainability, resource efficiency, and environmental performance while contributing to long-term industrial growth and national competitiveness.