ADB to Help Ease Poverty in Timor-Leste Through Better Roads

News Release | 28 September 2005

MANILA, PHILIPPINES - ADB will help boost economic growth and poverty reduction in Timor-Leste through a US$10 million grant approved from its Asian Development Fund (ADF) to improve the country's road infrastructure.

The project will rehabilitate and strengthen about 123 kilometers of crucial roads - Oeleu-Zumalai, Aituto-Same, and Viqueque-Uatucarbau - in agricultural areas currently suffering from isolation and food insecurity, but with the potential for industrial and port development and international trade.

These project roads were prioritized and selected based on their economic benefits in terms of reduced vehicle operating costs.

It will also conduct labor-intensive routine maintenance on the 45-km Iliomar-Lospalos road to demonstrate a low-cost, community-based approach to preventing the deterioration of roads and extending their life.

The project will also demonstrate an efficient bidding and contracting system for engaging communities in road maintenance through local small contractors. The project incorporates gender design features aimed at ensuring women's involvement in project activities, including road rehabilitation and maintenance of selected national roads, community-empowerment initiatives for sustainable rehabilitation and maintenance of selected rural feeder roads, including the prevention of the risks of road safety and HIV/AIDS.

"The project will help improve the lives of villagers by providing mobility to isolated societies, easing access to sources of food and social services, promoting trade, and reducing transport costs," says Marcelo Minc, an ADB Principal Infrastructure Specialist.

"It will also demonstrate sound and sustainable road maintenance policies that can minimize costs to the Government and to society."

Timor-Leste is one of the least-developed countries in the world, with more than 40% of the population reported to live under $0.55 per day, the national poverty line. ADB estimates, however, put the poverty figure much higher at as much as 88%, with 46% of the population living in absolute poverty.

While the country has an extensive and dense road network of about 6,000 km, this was constructed with relatively low standards of design and materials. Combined with the difficult geological conditions in the mountainous island country, torrential rains, and lack of maintenance, this has led to the rapid deterioration of the road system.

Only 24% of national roads and 11% of district roads are in good condition, causing high operating and repair costs for providers of public transport. This, in turn, results in high and unaffordable passenger fares, especially for the poor.

The Government recognizes that improving infrastructure, particularly the transport system, is critical in fostering private sector development, improving agricultural productivity, reducing poverty, promoting investment and human development, and strengthening government capacity to deliver services.

"As a new nation, Timor-Leste faces many challenges. But in the short-term, economic growth and jobs have to come from infrastructure investments," adds Mr. Minc.

The project will also demonstrate an efficient bidding and contracting system for engaging communities in road maintenance through local small contractors, and incorporates features to ensure women's involvement in project activities and prevent the spread of HIV/AIDS.

The Government will contribute $2.5 million equivalent toward the project's total estimated cost of $12.5 million. As a post-conflict country, Timor-Leste is eligible for grant-financing from the ADF.

The Ministry of Public Works is the executing agency for the project, which will be carried out over about two years.