World Bank approves new strategy to support Timor-Leste
Washington DC – 17 September 2009 --As Timor-Leste celebrates 10 years of independence, the World Bank's Board has approved a new strategy of support to the country that focuses on sustaining economic growth and building employment opportunities, especially for youth.
The overall objective of the 18-month strategy, which was developed through a broad process of consultation with government, civil society and other stakeholders, is to support the Government of Timor-Leste to convert its oil wealth into policies and programs that preserve stability while laying the foundations for sustained growth in non-oil sectors.
It targets four key areas of support to Government to achieve this: formulating a new national development strategy; building capacity to implement the new strategy; putting in place short-term social and economic stabilization activities; and securing long-term economic growth. This includes a multi-year public employment program; health and education support aimed at increasing public service delivery; further support for the management of petroleum revenues and programs to enhance private sector activity.
"Timor-Leste has achieved solid economic growth over the last two years," said World Bank Vice President Jim Adams. "This is no small achievement in difficult times - nationally and globally. Through the dedicated efforts of all sectors of Timorese society, social stability has been restored and an environment of economic growth is being fostered. Government spending has increased markedly and this is bringing benefits to poor people across the country.
"There is of course a long path ahead but with the dedication of the people of Timor-Leste being applied to address the challenges, we see a bright future."
With three quarters of the population engaged in subsistence farming and the majority of the population aged under 24, the Bank's "Interim Strategy Note" puts particular emphasis on helping the country improve agricultural productivity and tackling youth unemployment and alienation.
It highlights the need to bring short and long-term approaches together in a disciplined and accountable development process "that addresses the roots of conflict and prevents a further relapse of the kind experienced in 2006".
Mr Adams noted that Timor-Leste had implemented its national recovery strategy even in the face of assassination attempts on the President and Prime Minister in 2008. As a result:
- Thousands of internally displaced people have been resettled using Government-provided funds to reconstruct housing and rebuild livelihoods
- Hundreds of schools have continued to be built, rehabilitated or expanded allowing for tens of thousands more children to attend school
- Job creation programs are beginning to bring about much-needed local income generation, especially in poorer rural areas
- A pension scheme for veterans has been put in place as well as pensions for the elderly and disabled
- Non-oil GDP growth reached an impressive 12.8 percent in 2008
- Budget execution accelerated from US$65 million in 2005 to US$551 million in 2008, reflecting stronger financial management and strategic planning systems in the Ministry of Finance and other agencies.
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