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MEMO/11/142

Brussels, 7 March 2011

Q&A on EU aid to Timor Leste

What is EU aid toTimor-Leste?

The Commission has intensified its cooperation with Timor-Leste since its ratification of the Cotonou Agreement in December 2005. The support under the 10th European Development Fund (EDF) is €81 million to be spent on rural development, health and institutional capacity development (Ministry of Finance-NAO, Judiciary, and Parliament).

In addition, Timor-Leste benefits from support in Food Security, Non-State Actors/Local Authorities Program, and the Water and Energy Facilities. Under the Instrument for Stability, the Commission supports the security sector and other areas where the country could face potential conflicts (measures against the high unemployment, support to the re-integration of Internally Displaced persons) with a programme of €5.2 million.

Total Commission support, under the 10th EDF, is therefore close to €100million. €328 million has been provided to Timor-Leste since 1999. The European Union as a whole, including Member States and the Commission, has contributed close to half of the total assistance to Timor-Leste since 1999 (around €900 million).

What are the objectives of the programmes launched by Commissioner Piebalgs during his visit?

European Commissioner for Development, Andris Piebgalgs, will be visiting Timor-Leste, where together with the island-state's Minister of Finance he will sign a package of four strategic programmes for a total amount of €39 million (grants). These strategic programs encompass Support to Rural Development; Support to Democratic Governance; Support to Non-State Actors; A Technical Cooperation Facility.

A). The Support to Rural Development entails a support package of €23 million. Its purpose is to contribute to the realisation of the Government's vision for rural development, as described in the Strategic Framework for Rural Development. The first component of the project will seek to improve the whole agricultural knowledge system through the strengthening of the agricultural extension service. Expected results include:

  • New entrants to the agriculture sector educated in appropriate agricultural skills

  • Skills development training for Farmers and Extension Workers

  • Establishment of effective agricultural extension management systems

  • Efficiently executed Extension campaigns

  • Improved nutrition and reduction of poverty for rural households

The second component of the project will seek to rehabilitate the rural core network of roads to allow proper access to sub-districts and rural areas in order to stimulate agricultural production, assure access to markets and facilitate the entry of social services. Expected results include:

  • Local civil works contractors and supervisors who are competent in contract management.

  • Local civil works contractors and supervisors who are competent in labour-based rural road rehabilitation.

  • Efectively executed labour-based rural road rehabilitation contracts

B). The Support to Democratic Governance Processes encompasses a €10.5 million package, covering three components: support to Justice, National Parliament and Media.

Support to Parliament will focus on enhancing the human resources capacity (administrative and technical), and investing substantially in the creation of a robust cadre of future staff and management, and thereby strengthening the Parliament’s ability to fulfil its mandate in overseeing the Executive branch of government. Expected results include:

  • Strengthened institutional capacities of parliamentary administration to provide non-partisan and professional expertise

  • Legislators, national staff, civil servants and legal experts who are enabled to perform their functions

Support towards strengthening the Justice system will focus on:

  • Supporting the creation an engendered Court of Auditors

  • Supporting the capacity development of police criminal investigation services

Lastly, assistance to the Media sector will help to:

  • Enact the Media sector legal framework

  • Adopt internal governance standards by Journalists' Associations

  • Increase public’s knowledge about the Parliament, Court of Audit, justice and Police activities

  • Nurture and protect National Cultural Identity through TVTL archives

C). The Support to Non-State Actors involves a €4 million assistance package. Its objectives are to improve capacity building of networks and umbrella organisations in terms of internal planning, communications, leadership, organisation and coordination; to support inclusive dialogue and cooperation between local and central Government entities and non-state actors; and to enhance the participation of non-state actors at a decentralised level through appropriate actions of civic education and youth employment. Expected results include:

  • Facilitating dialogue and conflict prevention

  • Promotion of civic education

  • Increasing transparency and accountability

D). The Technical Cooperation Facility entails a €1.5 million support package. Its aim is to contribute to the implementation of the Government's national development programme through the support of sound interventions financed by resources from the European Development Fund (EDF); and to foster a more coherent and informed approach to issues of development. Expected results include:

  • Technical assistance in the form of short and medium-term consultation sessions

  • Training sessions on development implementation

  • Communication visibility and dissemination of European values and standards

Facts and Figures on Timor-Leste

  • Total surface: some 15.000 Km2.

  • Population of 1,100 million people.

  • In 2008, its population density was 73.9 persons per square kilometre;

  • Almost 13,000 kilometres separates Timor-Leste from the heart of Europe.

  • Timor-Leste is one of the least developed economies in the Asian region and is essentially agriculture-subsistence, with over two-thirds of the population living in rural areas, and at least one-third engaged in subsistence agriculture;

  • It has experienced robust economic growth of about 35% over the last three years;

  • Export: petroleum and coffee

  • It ranks 120th out of 169 countries (Human Development Report 2010) and belongs now to the "medium development" category, thus having moved up from 162nd ("low human development") out of 182 countries in the 2009 report;

  • Approximately 41% of the population lives below the poverty line even though poverty levels have decreased by about 9% in the last two years (estimations);

  • Maternal mortality is high with an estimated 450 deaths per 100,000 live births;

  • Over 64% of the population suffers from food insecurity;

Timor Leste and Millennium Development Goals

Timor-Leste is faced with challenges to achieve MDGs, compounded by the nation’s shattered infrastructure and a skills and human resource deficit resulting from the upheaval and displacement that accompanied the transition leading to independence.

The nation had to simultaneously re-build itself, develop government and institutions of state, and provide for a highly dispersed population with limited capacity to manage development efforts.

There is still much work to be done in many areas, particularly in tackling food insecurity, disease, unemployment and trying to halt the spread of HIV/AIDS which has the potential to spread rapidly.

However, real progress has been made. This includes:

(a) efforts towards eradicating poverty by providing state assistance for vulnerable groups, by actively trying to create jobs and by assisting farmers to improve agricultural productivity and revenue through support by Donors amongst who the EC is in a lead position,

(b) progress in achieving universal access to primary education (MDG 2),

(c) efforts in promoting gender equality (MDG 3) through mainstreaming gender into the projects/programmes including the EC-funded ones and

(d) efforts to improve the health sector which has helped to reduce child mortality (MDG 4), with important assistance by Donors including the EC .

Timor-Leste has access to important oil and gas reserves in the Timor Sea shared with Australia. The country has won international acclaim for managing the resulting revenues prudently through the Petroleum Fund established in 2005 following the Norwegian model. By end 2010 the Fund stood at 6.6 bn US$.

In 2010 the Extractive Industry's Transparency Initiative (EITI) announced that Timor-Leste became only the 3rd country in the world to be EITI compliant.

What are Some Examples of Projects in Timor-Leste?

The EU has been supporting a Rural Development Programme, which promotes the concept of Village Development Planning (VDP). VDP is a forum that showcases people's participation in their own development, thus promoting local governance in a true "bottom-up" approach. It allows people meet, discuss, analyse, debate and agree on the kind of future they want for themselves and their community. VDP started in 2008 as a pilot scheme in four Sukos (Villages) of the Covalima District.  The process was repeated after one year in the same Sukos and then expanded to another four villages.

The EU also financed the Rural Development Programme II with €9 million. The objective of this project was to achieve food security, reduce poverty and enhance the benefits from economic and social opportunities that lead to sustainable improved livelihoods for rural communities, especially women and youths. One of the aspects of the project was focusing on agriculture and farmer's income. Between 2007 and 2010, thanks to the project, the production of rice and maize (the main staple foodstuffs in Timor Leste) was substantially improved. Notably, as a result of the successful introduction of the system for rice intensification (SRI) there was a 25 % increase in yield per hectare This translates into US$ 930 000 of additional income from paddy rice in the two targeted western districts of Bobonaro and Covalima. Another example is the introduction of improved seeds of maize which, in combination with weeding and improved planting techniques has resulted in a 50% increase in yield per hectare.


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