Timor-Leste Road Rehabilitation Project to Boost Growth, Reduce Poverty

MANILA, PHILIPPINES - The Democratic Republic of Timor-Leste is targeting a major overhaul of its badly degraded road network to accelerate new economic opportunities and poverty reduction.

To support the government’s goal, the Asian Development Bank’s (ADB) Board of Directors approved a $46 million grant for the Road Network Development Sector Project. It will be used to rehabilitate over 230 kilometers of national roads, develop a road maintenance program, upgrade cross-border facilities with Indonesia and boost the capabilities of road regulators and national contractors. The Japan Fund for Poverty Reduction (JFPR), financed by the Government of Japan, is providing an associated grant of $3 million to ensure the social and economic benefits of the project are delivered to roadside communities, particularly in remote areas.

Timor-Leste, on the eastern half of Timor Island, has suffered from years of conflict and underdevelopment, and almost its entire core road network needs to be rehabilitated. Roads are the primary form of transport and their poor condition has raised transport costs, cut off communities, reduced access to markets and income opportunities, and contributed to food shortages for up to five months a year in many households.

“The development of roads is widely recognized as a key factor in creating jobs, promoting private sector growth, increasing agricultural productivity and reducing poverty, and the project will support these goals, as well as strengthen connectivity.” said S. Hafeez Rahman, Director General of ADB's Pacific Department.

Delayed and inadequate maintenance is a major cause of premature road deterioration in Timor-Leste. The project will not only support road rehabilitation, but also will help the government to establish a road maintenance program covering the border region. The Ministry of Infrastructure is expected to replicate the model in other regions. Training will be provided to build the capacity of national contractors in road maintenance technology, procurement, and project management.

A key element of the project is the inclusion of climate proofing designs so that upgraded roads become less vulnerable to floods and landslides. New facilities at border posts with West Timor will boost ties with Indonesia, which is Timor-Leste’s main source of imports and third largest export market.

The JFPR grant will finance community-based rehabilitation of feeder roads that will result in upgrades to around 90 kilometers of rural roads and improved connectivity to key services. It will support the development of community facilities, and community-based small contractors, and provide community skills training, especially for women. It will also fund a pilot scheme in three districts to help local government units develop the capacity to support community road maintenance and other infrastructure works.

“The grant will help extend the socioeconomic benefits of the larger project to roadside communities as well as developing a sustainable community participation model for infrastructure work with the local government,” said Mr. Sungsup Ra, Director, Pacific Strategy and Special Operations Division of ADB's Pacific Department.

ADB’s grant, from its concessional Asian Development Fund, makes up nearly 87% of the total project cost of $52.9 million, with the government providing counterpart funds of $6.9 million. The project is due for completion in November 2014. The JFPR grant makes up around 86% of the total associated project cost of $3.47 million, with the government contributing $456,000 and communities just over $14,400 in-kind. The associated project will be completed by January 2014. The Ministry of Infrastructure is the executing agency for both projects.