Timor-Leste: Economy

Timor-Leste is one of the least developed countries in the world, with basic income, health, and literacy levels similar to those of countries in sub-Saharan Africa. Infrastructure is inadequate in urban and rural areas. Unemployment and underemployment combined are estimated to be as high as 70%. Official statistics indicate that around 40% of the country's population lives below the poverty line.

Timor-Leste has received oil and gas revenues since 2005 as major projects in the Joint Petroleum Development Area that Timor-Leste shares with Australia have come online. The government set up a special Petroleum Fund in 2005 to ensure the sustainable use of its revenues over the long term. Petroleum Fund assets reached $8.3 billion in 2011.

The economy is dependent on government spending (financed by petroleum revenues) and assistance from international donors. Private sector development has lagged due to human capital shortages, infrastructure weakness, an incomplete legal system, and an inefficient regulatory environment.

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