Timor-Leste has transformed from a country in conflict to one of the fastest-growing economies in the world. Average annual growth has exceeded 10 percent, prompting noted development economist Jeffrey Sachs to predict that, “between 2010 and 2020 Timor-Leste will grow faster than China.”
Petroleum continues to be the leading industry in the economy with receipts in 2010 reaching $2.1 billion.
“Between 2010 and 2020 Timor-Leste will grow faster than China.” Jeffrey Sachs economist
The banking sector also shows signs of growth: the largest increase in private sector credit flowed to the tourism and service sectors.
Government spending picked up rapidly in the second half of 2010,and other indicators, such as electricity consumption, also point to strong demand in the economy.
Timor-Leste is investing in human capital, infrastructure and vital sectors of the economy, such as oil, gas and agriculture. Since Timor-Leste emerged from conflict, health, literacy and education have been on the rise. Planned spending in 2010 increased from $660 million to $838 million. Much of the increase was spent on infrastructure, food security, social payments for vulnerable groups, and agriculture.
Poverty levels are on the decline, falling nearly 10 percent since 2007. In addition, four of 13 districts have been declared free of illiteracy. Preliminary census results show a sharp increase in enrollment rates for basic education, reaching almost 90 percent in 2010.
Timor-Leste has surpassed the Millennium Development Goals target for 2015 for both the under 5 mortality rate and the infant mortality rate. Challenges clearly remain, but Timor-Leste has become an example of a country that has an ambitious strategy for growth and is focusing its resources to meet its goals.