Timor-Leste

Timor-Leste and ADB

ADB remains committed to a secure and prosperous future for the Timorese. ADB's support is doubly important going forward from this crisis and ADB's Strategy and Program for Timor-Leste (2006-2008) is now even more relevant and apt. In his acceptance speech on 10 July 2006, incoming Prime Minister H.E. Dr. Jose Ramos Horta emphasized the urgent need to activate an expanded public capital investment program to create thousands of new jobs, to spur private sector investment, and to deliver services to ordinary East Timorese. This is exactly ADB's niche in Timor-Leste-helping the government and donors manage capital programs and strengthening infrastructure agencies to maintain assets and deliver services. Prime Minister Ramos Horta singled out in his acceptance speech ADB's ability to remobilize road rehabilitation works in Timor-Leste soon after the violence had subsided.

The ADB has allocated $1.0 million for each of the next three years to help prepare and implement infrastructure investment programs and to improve asset management and service delivery. The ADB is also financing infrastructure investments:

• $10 million for national roads rehabilitation during 2006-2008 (approved, and pre-construction activities commenced);
• $6 million to improve water supply services in Dili (under preparation for approval in early 2007).

ADB is also providing technical assistance to strengthen financial management capacity ($0.25 million), to develop public sector management and capacity skills ($0.55 million), and to strengthen microfinance operations ($0.5 million).

Country Strategy and Program Update (CSPU)

The ADB and the Government of Timor-Leste in August 2005 agreed a new Country Strategy and Program Update (CSPU) for the three years 2006-2008.

This new CSPU, prepared and agreed before the 2006 crisis, is even more relevant and appropriate for Timor-Leste as it recovers from these difficulties. ADB and the Government had already realized in 2005 that ordinary people were not benefiting directly enough from the 'State building' that the Government and development partners had been focusing on. After sacrificing much to achieve independence, the poor remained poor, they lacked access to social services, and they faced bleak economic prospects. Not comprehending the demands of nation building, it was entirely valid for ordinary East Timorese to wonder about the effectiveness of the billion-plus dollars of development assistance ploughed into Timor-Leste since 1999.

So the Government asked ADB to concentrate its support on infrastructure planning and investment and infrastructure services delivery. The Government believed this would directly and quickly improve the lives of ordinary East Timorese through immediate job creation, especially rural villagers working on road rehabilitation and maintenance, and through better access to infrastructure services such as transport and water supply.

Consistent with ADB's global commitment to development 'results', the Government and ADB, in consultation with other stakeholders developed a results-based CSPU that would directly contribute to specific goals and objectives contained in Timor-Leste's National Development Plan (NDP), namely (i) provide roads and bridges for the movement of people and goods, orderly and efficient functioning of markets, and sustainable development (NDP page 37); (ii) provide adequate, safe, and sustainable water supplies for the communities of Dili and major centers in districts, with the aim of full cost recovery (NDP page 275); and (iii) facilitate at the national level the safe disposal of sewage and wastewater in urban areas (NDP page 275). This was ADB's first ever results-based CSPU. The Results Framework is contained on pages 10 to 12, of the CSPU 2006-2008.

Meanwhile, ADB and the government had signed a Poverty Reduction Partnership Agreement for Timor-Leste on 28 October 2003.

In May 2002 the Government of Timor-Leste produced the National Development Plan (NDP) with two goals:

1. to reduce poverty in all sectors and regions of the nation
2. to promote economic growth that is equitable and sustainable, improving the heath, education, and well being of everyone in Timor-Leste.

A Poverty Reduction Strategy is an important component of the plan. In July 2002, Timor-Leste joined ADB. An ADB country strategy was formulated to help the Government meet its National Development Plan goals of reducing poverty and accelerating economic growth and on 28 October 2003, Timor-Leste and ADB signed the Poverty Reduction Partnership Agreement.

• ADB Projects in Timor-Leste
• Business Opportunities in Timor-Leste
• Trust Fund for East Timor (TFET)