TIMOR – LESTE : “LDC Graduation and Resources mobilization trends, 

challenges and Opportunities in LDCs”

Workshop 0n Supporting the Least Developed Countries in Asia Pacific in meeting the challenge of resources mobilization for achieving the 2030 agenda for sustainable development

Phnom Penh, Cambodia , 6‐7 December 2018

Mr. Antonio FreitasDeputy Permanent Representative to ESCAP and Attache of Cooperation 

EMBASSY OF TIMOR – LESTE Kingdom of Thailand 

Outline of Presentation

• Introduction• Resources mobilization trends• Challenges and Opportunities in LDCs• LDC Graduation• Conclusion 

REPÚBLICA DEMOCRÁTICA DE TIMOR‐LESTE (RDTL )

Introduction : 1) As a post conflict state with a young

democracy that achieved full self‐government only in 2002 ;

2) The success story of the UnitedNations peace keeping mission inTimor‐Leste;

3) Timor – Leste is committed itself tocontinue working towards theachievement of sustainabledevelopment goals stipulated in theAgenda of 2030;

3

The Timor – Leste Journey

1975 Unilateral Independence

1976 -1999Under occupation

1999Referendum

2002 Restauration of Independence

20..

LDC Graduated..?

TIMOR – LESTE “ ECONOMIC DIVERSIFICATION STRATEGY

• The economic vision of the SDP ( Strategy Development Plan ) of Timor – Leste is will be part of the group of the middle‐upper income countries (2030) , extreme poverty will be eradicated and a non‐oil sustainable and diversified economy will be established (In SDP 2011‐2030);

• The Government of Timor‐Leste develop a National Planning Framework, with a view to the implementation of Development Centers in the various regions of the country, which defines the characteristics of each region and the growth potential of each sector and sub‐ sector.

• Public investment seen from 2007 to 2016 through the frontloading fiscal policy has driven growth in the non‐oil economy, averaging at 6.9% per year ;

• The real non‐oil GDP growth was strong in 2016 at 5.3%, up from 4.0% in 2015 • Timor‐Leste Petroleum Fund is Timor‐Leste Petroleum Fund is the cornerstone of the Government´s economic policy ;

Guide for the Economic Reform and Growth

GRFE sets out measures to be taken in:5 Priority Economic Sectors: Oil and Gas, Agriculture, Fisheries, Tourism, and Manufacturing, and7 Reform Areas: Land and Property Regulation, Development of Economic Infrastructure, Labor Regulations and Work Force Development, Business Environment Reform, Fiscal Reform, Reform of the Private Investment Regime and Development of the Private Sector.

Resources mobilization trends• There are two type resource mobilization adopted in Timor – Leste :

a. The resources financial is coming from State Reveunues ( Oil and Non Oil);b. Donor Contrbution and loans (Debt )

• Prime Minister office and Ministry of Finance in collaboration to playing asignificant role in mobilizing Goverment resourcess and to achieve objectives suchtrough a planning , budgeting and monitoring of implementation of Budget;

• Mostly Petroleum fund financing represent 80% for public spending (StateBudget) , 8% from domestic revebue and around 12% budget is coverd by ODAbasic on Goverment Priority to SDP (Strategy Development Plan ) and SDGs;

• The Ministry of Finance has fully responsible in managing ODA , Ministry of Finance basicly did high level annual meeting so called Timor‐ Leste and Development Partners Meeting and quarterly development partners meeting;

Expenditure by Fund 2018

2016 Actual 

2017 Provisio

nal 

2018 Budget  2019  2020  2021  2022 

Combined Sources Budget  1,834.5  1,369.6  1,461.3  1,772.9  1,480.8  1,309.1  1,303.8 

Government Expenditures by Fund  1,629.9  1,192.9  1,279.6  1,633.9  1,365.3  1,256.7  1,303.8 

CFTL (excl. loans)  1,570.6  1,138.9  1,194.1  1,522.1  1,299.4  1,216.4  1,266.2 

HCDF  28.7  23.9  23.9  24.8  25.8  26.8  27.9 Borrowing/Loans (disbursements)  30.6  30.1  61.6  87.0  40.0  13.5  9.7 

Development Partner Commitments  204.6  176.7  181.7  139.0  115.5  52.4  ‐ 

Adopted on transparency and accountability• Since Adopted SDP ( Strategy development Plan ) 2011, Timor – LesteGovernment trough Ministry of Finance open sources budget information to all stakeholders ( Government Portal Transparency) www.transparency.gov.tl/english.html

• Ministry of Finance Trough Department of Policy Mobilization External Funding , annual produce information to National Parliament on external assistance ;

• Government of Timor – Leste establish Aid Information Management System , called Aid Transparency Portal . This Portal to track all foreign aid assistance , https://aidtransparency.gov.tl/portal/

• In related sustainability of development  in Timor – Leste, significant contribution from foreign aid assistance , five year past shown around USD 200million however it decrease significant around 80% in 2018.   

República Democrática de Timor-Leste

Livro 5

Parceiros de Desenvolvimento

República Democrática de Timor-Leste

Book 1

Budget Overview

República Democrática de Timor-Leste

Livro 5

Parceiros de Desenvolvimento

República Democrática de Timor-Leste

Book 1

Budget Overview

LDC Graduation• Timor‐Leste was one of the first countries to fully endorse the 2030 Agenda for Sustainable Development in the context of fragile and conflict affected states;

• Timor‐Leste has now fulfilled two criteria for LDC graduation, however, its Economic Vulnerability Index show substantial economic vulnerabilities, with a score of 56.8 ;

• Timor‐Leste is very far from the economic vulnerability threshold, meaning there is high economic vulnerability ;

• Timor‐Leste remains an undiversified economy, heavily dependent on the oil sector ;

• Timor‐Leste is a young country that has made substantial progress, and is committed to continue its development trajectory towards sustainable peace and prosperity ;

• Graduating from LDC status is a government goal, to be achieved when it is the right time to do so .

Challenges and Opportunities in LDCs

• Limitation in mobilize external resources;• Revision on Aid Policy;• Timor‐Leste is engaged in an accession process to WTO as an LDC• Timor‐Leste was one of the first countries to fully endorse the 2030 Agenda for Sustainable Development in the context of fragile and conflict affected states;

Conclusion 

• In this broader perspective, Graduating from LDC status is a Timor –Leste government goal ;

• Graduating from the Least Developed Countries (LDCs) is of course inthe long‐term interest of Timor‐Leste, as it will advance its politicalstanding and image in international affairs

• Timor‐Leste believes suitable momentum is to allow fullyimplementation of its national strategic development plan thatsimultaneously in the spirit of sustainable development goals of the2030 Agenda;

OBRIGADO