Subject: LUSA: Stronger administration, bigger non-oil sector needed - IMF report

East Timor: Stronger administration, bigger non-oil sector needed - IMF report

Washington, July 21 (Lusa) - East Timor`s future development depends on "effective administration of its new petroleum wealth" and the attraction of investment into the non-oil sector of the new nation's economy, the International Monetary Fund says in a report.

In a report released Wednesday and based on contacts with Timorese leaders last month, the IMF Executive Board notes that although Timor has made "modest" progress in bolstering its non-oil economy, stronger performance in this sector is crucial to alleviate poverty and create jobs.

Dili's budget plans for 2005/2006 are described as "ambitious" by the IMF, given the present limited administrative capacity in Timor and reduced absorption levels of the national economy.

The creation of Timor's Petroleum Fund, designed to ensure transparent management of oil revenues, is welcomed in the IMF document, but the Dili authorities are cautioned to "carefully consider" the pros and cons of setting up a state oil company.

In the non-hydrocarbon sector, "strengthening of the tax and excise duty systems" are needed, as well as care in devising an incentive system in future laws governing investment, says the report.

The IMF praises Dili+s "maintaining of liberalized trade and investment systems", but calls for speedy implementation of pending legislation in this area, as well as new laws on bankruptcy.

Technical assistance from the international community remains essential for the establishment of strong institutions and effective management of Timor's economy, adds the IMF.

Separately, Foreign Minister José Ramos Horta arrived Thursday in Rangoon for talks with Burmese officials aimed at establishing formal bilateral diplomatic ties, official sources told Lusa.

Diplomatic sources told Lusa that the Timorese diplomat will try and contact Burmese opposition leader Auung San Suu Kyi, being kept under house arrest by Rangoon's military rulers.

Ramos Horta will stay in Burma until Sunday before traveling to a ministerial meeting of the ASEAN Regional Form (ARF) in Laos, where Timor will formally join the ARF.

The ARF groups the 10 members of ASEAN (the Association of Southeast Asian Nations) with other nations in the Pacific-Asia region, including China, the United States, Japan and Russia.



Back to July menu 
World Leaders Contact List
Main Postings Menu