Timor Knowledge Centre

Developed by INFUSE in conjunction with the United Nations Integrated Mission in Timor-Leste (UNMIT) Geographic Information Systems (GIS) Unit, the map displays access points of financial services at the village level, where financial service providers, including commercial banks, microfinance institutions and credit unions, are operating in Timor-Leste as of 31 December 2009.

Through the International Finance Corporation (IFC)-supported Better Business Initiative public-private dialogue the business community has identified access to longer-term investment finance as a key constraint to growth.  However effective demand is much lower than stated demand and there are several other constraints that additional credit would not resolve. This report presents options for Government of Timor-Leste’s participation in the financial services sector.

This is the staff report for the 2009 Article IV consultation, prepared by a staff team of the IMF, following discussions with the officials of the Democratic Republic of Timor-Leste on economic developments and policies. The paper includes an annex on “Prospects for Financial Development: The Emerging Role of Microfinance” which provides a brief assessment of the financial sector.

This diagnostic provides an overview of the financial sector in Timor-Leste through an in-depth look at each of the financial service providers comprising the sector, including assessment of their strategy and positioning, outreach, and portfolio quality. A gap analysis is undertaken to identify constraints and opportunities to improve and expand outreach of financial services.

This report provides a brief overview of the policy and regulatory framework for remittances in the Timor Leste. In particular, the report provides an overview of the foreign exchange licensing rules and regulations, rules relating to mobilisation of deposits by non?bank institutions, prudential regulations affecting non?bank sector growth, tax treatment and incentives relating to migration and remittances.

This document contains a situational analysis which evaluates the country context and financial sector development, outlines the objectives of the Programme, details the strategies and activities to be employed in order to achieve programme objectives, and identifies measurable output targets against which to monitor INFUSE programme performance.

This paper examines the conditions necessary for private-sector development in Timor-Leste, where the vast majority of the workforce is engaged in subsistence agricultural production. It argues the need for an enabling policy environment, including regulation that promotes access to finance for investment and working capital, to encourage informal sector dynamism and transition from subsistence to monetization in agriculture.

This assessment of the financial sector utilises a financial systems approach, involving an assessment of the characteristics of the client market and the structure of demand for financial services, the existing providers of financial services, the financial and non-financial infrastructure for these retailers (such as training, technical assistance, audit and fund provision)and the enabling environment at macro-level, including policies, legislation and regulation pertaining to or affecting the finance sector.

This review analyses and evaluates experience with the Community Empowerment Project (CEP) credit component in Timor-Leste. The objective of the project was “to strengthen local level social capital to build institutions that reduce poverty and support inclusive patterns of growth,” with a key aspect being to support productive local economic activities through a credit product. The review assesses and evaluates objectives of the credit component, outcomes, institutional and poverty impacts, sustainability and the performance of the Bank and Government, factors that affected implementation, major lessons and policy recommendations.