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Timor Leste: from conflict to leadership

June 30, 2011


Timor-Leste rebuilds to become global voice for post conflict countries.

Dili, Timor-Leste, June 30, 2011, Timor-Leste has emerged from the ashes of conflict, a journey beginning with its struggle for independence. Today, the country is growing rapidly, and is expected to maintain strong growth in the years to come. More Timorese children are now going to school, with school dropout rates decreasing by 50 percent; more people have access to health care, with outpatient health care visits doubling from 2001 to 2007; and hope has returned to its people.

Throughout this time, Timor-Leste has faced many difficult challenges. More than a decade ago, conflict exacted a heavy toll on the country and its people – families, homes, businesses and infrastructure were hit hard.

Backed by strong petroleum exports, Timor-Leste is now experiencing very strong growth. The Timorese people are taking important steps to manage their precious offshore oil revenues for the future. They have created a Petroleum Fund and signed on to the Extractive Industries Transparency Initiative – to ensure transparency and accountability around revenues from their offshore oil boom.

The road to recovery is focused on building much needed schools, hospitals and other infrastructure. It is also about investing in the Timorese people, with the country in the drivers’ seat. The World Bank has supported Timor-Leste’s progress since the beginning – as the country’s confidence and capabilities grew.

Technical assistance provided by the World Bank through the Planning and Financial Management Capacity Building Program is improving the government’s ability to invest in the country, says Finance Minister Emilia Pires:

Huge institutional gains have been made with capacity building. All the public finance indicators have improved year on year since the program has been adapted in 2007. The success was based on trust, continual evaluation as to the needs of the Ministry and ownership of the program to implement Government reforms.” 

Through these efforts, Timor-Leste is sending an important signal to global markets. It is expected to progress from the World Bank’s group of poorest countries to be eligible for borrowing.

As a testimony to its achievements, Timor-Leste was selected as the chair of the “g7+”, which represents 17 fragile and conflict affected countries including Sudan. The World Bank is supporting this initiative.

The World Development Report 2011, the World Bank’s latest research on post conflict states, shows it takes fifteen to thirty years for countries to rebuild after conflict, which suggests Timor-Leste still has many challenges ahead.

Nobel Peace Laureate and President of Timor-Leste, Jose Ramos-Horta, recently recognized the work the World Bank has undertaken to support Timor-Leste since its independence:

"While donors including the World Bank have not been flawless, there are always special difficulties and a price in working in post conflict environments. In Timor-Leste the Bank has taken risks in engaging in such an environment, and contributed positively to the development that Timor-Leste has achieved in the past decade."

Results of the World Bank’s partnership with Timor-Leste

  • The World Bank worked with Government to rehabilitate 2,780 classrooms in 535 schools and built 102 new education facilities. Primary and secondary enrollment rates improved. There was improved access to schools in remote rural areas, more children attended early classes and school dropout rates dropped by 50 percent.
  • The World Bank supported the Government in rehabilitating and rebuilding four of its five regional referral hospitals based in the districts, as well as the central hospital in Dili. The Bank also supported the construction of a large number of health centers and the operation of mobile clinics to service remote areas of the country. The supply of medical equipment and drugs was also enhanced. The number of outpatient health care visits nearly doubled from 2001 to 2007, life expectancy at birth increased from 56 to 61 years from 2000 to 2008, and infant mortality rates has declined by 40 percent.
  • The World Bank worked with the government to rehabilitate and develop irrigation systems on 4,000 hectares of the country’s arable land, so people could grow crops and food and vaccination of livestock was undertaken.
  • The World Bank supported the Government in developing policies to support the country’s veterans which enabled the registration of 75,000 veterans, allowing thousands of them to receive pension payments.
  • The World Bank has also assisted the government in advice over shared petroleum resources, supporting Timor’s efforts to fully realize the benefits of its offshore resources and generate greater wealth. The Bank supported the Government in the establishment of a petroleum regime that is internationally competitive in its terms and considered to be an international best practice model.
  • The World Bank has also supported Timor’s successful application and entry in the Extractive Industries Transparency Initiative (EITI), which makes the country a global leader in providing transparent accounting of revenues and expenditures related to its oil resources.
  • Timor is also playing a growing global role in representing the shared interests of post-conflict countries on the international stage through the “g7+ initiative” and the World Bank is supporting this work.
  • The World Bank’s Youth Development Project is working with government to promote youth empowerment and expand opportunities for youth groups to initiate and participate in community and local development initiatives. To date, the project has achieved significant results, providing youth grants for a total of 274 projects, including 23 grants to rebuild or rehabilitate youth centers and 50 grants to provide training. Over 182 projects been completed, including: the rehabilitation of youth centers, development of sporting fields and community infrastructure.
  • The World Bank has provided technical assistance to the Ministry of Finance to strengthen its planning, budgeting, public expenditure management and revenue administration functions. This led to a tenfold increase in spending between 2005 and 2010, which has enabled government to deliver more services and undertake major public works activities to stimulate the economy in 2008-2009.
  • The World Bank Group has made a significant contribution to the development of the legislative framework, contributing to the adoption of more than 44 laws in the last decade, ranging from the Petroleum Fund Law (2005) through to Aviation Law (2003) and Law on Domestic Violence (2010). The World Bank is also supporting the government’s efforts to develop new legislation to open up competition in the telecommunications sector.
  • The World Bank Group’s private sector arm, the IFC, supported the Better Business Initiative, a structured dialogue forum between the private and public sector to promote a dialogue and effective reforms to improve the business environment and foster local and foreign investment. The IFC, together with partners, launched an online marketing and booking system for Timor-Leste that will connect local tourism enterprises with the global travel market.
  • And perhaps one of the best indicators of Timor’s achievements is its expected reclassification to eligibility for IFI loans, both from IDA and IBRD and the ADB.