The New Economic Mechanism (NEM) is the economic model employed in Laos, since 1986. It is similar to China's socialist market economy and Vietnam's socialist-oriented market economy, in that it is a market-based socialist economy, with a predominance of state ownership, and the Lao People's Revolutionary Party directing the markets through state planning.[1] It was based on the Soviet Union's New Economic Policy (NEP).[1] Its justification was that the country, which had been heavily bombed by the United States during the Vietnam War, lacked an industrial base and was too underdeveloped to build socialism.[1]