Timor-Leste: Economy#

Since gaining independence in 1999, Timor-Leste has faced great challenges in rebuilding its infrastructure, strengthening the civil administration, and generating jobs for young people entering the work force. The development of offshore oil and gas resources has greatly supplemented government revenues. This technology-intensive industry, however, has done little to create jobs in part because there are no production facilities in Timor-Leste. Gas is currently piped to Australia for processing, but Timor-Leste has expressed interest in developing a domestic processing capacity.

In June 2005, the National Parliament unanimously approved the creation of the Timor-Leste Petroleum Fund to serve as a repository for all petroleum revenues and to preserve the value of Timor-Leste's petroleum wealth for future generations. The Fund held assets of $16.5 billion, as of December 2014. Oil accounts for 90% of government revenues, and the drop in the price of oil in 2014 has led to concerns about the long-term sustainability of government spending. The Ministry of Finance maintains that the Petroleum Fund is sufficient to sustain government operations for the foreseeable future.

Annual government budget expenditures increased markedly between 2009 and 2012 but dropped significantly in 2013-15. Historically, the government failed to spend as much as its budget allowed. The government has focused significant resources on basic infrastructure, including electricity and roads. Limited experience in procurement and infrastructure building has hampered these projects. The underlying economic policy challenge the country faces remains how best to use oil-and-gas wealth to lift the non-oil economy onto a higher growth path and to reduce poverty.

Economic Facts#

GDP (purchasing power parity)$4.975 billion (2016 est.)
$4.738 billion (2015 est.)
$4.545 billion (2014 est.)
note: data are in 2016 dollars
GDP (official exchange rate)$2.501 billion (2015 est.)
note: non-oil GDP
GDP - real growth rate5% (2016 est.)
4.3% (2015 est.)
5.9% (2014 est.)
GDP - per capita (PPP)$4,200 (2016 est.)
$4,100 (2015 est.)
$4,000 (2014 est.)
note: data are in 2016 dollars
GDP - composition, by end usehousehold consumption: 43%
government consumption: 27.2%
investment in fixed capital: 17.5%
investment in inventories: 0%
exports of goods and services: 70.8%
imports of goods and services: -58.5% (2016 est.)
GDP - composition, by sector of originagriculture: 7.5%
industry: 68%
services: 24.4% (2016 est.)
Agriculture - productscoffee, rice, corn, cassava (manioc, tapioca), sweet potatoes, soybeans, cabbage, mangoes, bananas, vanilla
Industriesprinting, soap manufacturing, handicrafts, woven cloth
Industrial production growth rate-5% (2016 est.)
Labor force259,800 (2013 est.)
Labor force - by occupationagriculture: 64%
industry: 10%
services: 26% (2010)
Unemployment rate11% (2013 est.)
18.4% (2010 est.)
Population below poverty line37% (2011 est.)
Household income or consumption by percentage sharelowest 10%: 4%
highest 10%: 27% (2007)
Distribution of family income - Gini index31.9 (2007 est.)
38 (2002 est.)
Budgetrevenues: $300 million
expenditures: $2.8 billion (2016 est.)
Taxes and other revenues12% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-100% of GDP (2016 est.)
Fiscal yearcalendar year
Inflation rate (consumer prices)-0.8% (2016 est.)
0.6% (2015 est.)
Commercial bank prime lending rate13.5% (31 December 2016 est.)
13.5% (31 December 2015 est.)
Stock of narrow money$456.9 million (31 December 2016 est.)
$397.7 million (31 December 2015 est.)
Stock of broad money$677.8 million (31 December 2015 est.)
$599.8 million (31 December 2014 est.)
Stock of domestic credit$-200 million (31 December 2016 est.)
$-127 million (31 December 2015 est.)
Market value of publicly traded shares$NA
Current account balance-$248 million (2016 est.)
$239 million (2015 est.)
Exports$18 million (2015 est.)
$18 million (2015 est.)
Exports - commoditiesoil, coffee, sandalwood, marble
note: potential for vanilla exports
Imports$647.7 million (2015 est.)
$647.7 million (2015 est.)
Imports - commoditiesfood, gasoline, kerosene, machinery
Debt - external$311.5 million (31 December 2014 est.)
$687 million (31 December 2013 est.)
Exchange ratesthe US dollar is used