1. Timor-Leste
Country Risk Analysis:
A Macroeconomic risk
Tomas Freitas
Timor-Leste
Country Risk Analysis

2. Outline
•
•
•
•
•
Country & Economy Performance
Transparency and Accountability
Theoretical Framework
Economy Growth ( the elements of GDP)
Conclusion
Timor-Leste
Country Risk Analysis

3. Country & Economy Performance
Item
weight
Source
Population
1.2 Million
NSD (2011)
Life Expectancy
62.5 year
HDR (2011)
Child Mortality under five
year old
56 Per 1000 live
birth
HDR (2011)
Access Clean Water
35.7%
HDR (2011)
Access to Education (Primary 90%
School)
MoF (2012)
Growth National Income
2,704 Million (USD)
IMF (2010)
GDP Per capita
$805 (USD)
HDR (2011)
Real GDP Growth
9.5%
ADB (2010)
Urban Unemployment
42%
MoF (2012)
Rural Unemployment
80%
MoF (2012)
Inflation
12.4%
MoF (2011)
BOP (Current Account)
1,717 Million USD
BCTL (2010)
Savings
+10 Billion USD
BCTL (2012)
Timor-Leste
Country Risk Analysis

4. Timor-Leste Transparency and Accountability performance
Index
Period
Rank
Score
Revenue Transparency
2010
12/40
70.5
Corruption Perceptions
2011
143/183
2.4/10
Judicial Independence
2010-2012
86/142
3.3/7
Rule of Law
2010
10%
-1.2
Open Budget
2010
Minimal
34
Voice & Accountability
2010
49%
0.02
Control of Corruption
2010
18%
0.95
Human Development
Report
2011
147/187
(Low)
0.495
Press Freedom
2011-2012
86/179
30.00
Source: Transparency International http://www.transparency.org/country#TLS
Timor-Leste
Country Risk Analysis

5. Theoretical Framework
• Macroeconomic
– Income Approach
GDP: The total income earned by the household in a
nation during a year
Total Income = Rent + Wages + Interest + profit
– Expenditures Approach
GDP: the total amount spent on goods and services
in a nation by households, firms, government and
foreigners
GDP = C + I + G + Xn)
Timor-Leste
Country Risk Analysis

6. GDP Growth
Source: IMF, World Economic Outlook
Timor-Leste
Country Risk Analysis

7. Elements Of The GDP
Fiscal Year
Consumption
Based on
Consumer Price
Index in Million
US Dollar
Investment Gov Exp in
In Capital
Asset
(Million US
Dollar)
Health, Education,
Agriculture,
Infrastructure &
Social Security
Exports
Imports
Trade
Balance
in Million US Dollar
2004-05
107.5
-
52.3/79.0
105,645
146,108
-40,454
2005-06
107.5
-
46.1/112.0
43,451
109,127
-65,676
2006-07
120.0
-
142.9/328.6
60,685
100,802
-40,117
Transition
134.1
-
72.9/116.4
19,179
206,133
-186,954
2008
145.6
-
208.7/483.9
49,207
268,584
-219,377
2009
146.4
-
355.1/603.6
34,512
295,096
-260,584
2010
-
54
458.8/758.7
-
-
-
2011
-
-
365/1,306.0
-
-
-
2012
-
-
423.9/1,674.1
-
-
-
Sources: Ministry of Finance & National Statistic Directorate
Timor-Leste
Country Risk Analysis

8. Elements of Consumption
Source: National Statistic Directorate
Data compiled from April 2011-April 2012
Timor-Leste
Country Risk Analysis

9. Government Expenditures
Sources: Ministry of Finance
Timor-Leste
Country Risk Analysis

10. Revenues contribution to State Budget
Source: Ministry of Finance
Timor-Leste
Country Risk Analysis

11. Merchandise Import of Major commodities
Commodity
Value
Commodity
in US Dollar
Value
in US Dollar
Vehicles (Cars &
Motorbikes)
58,486,000
Construction materials
4,075,138
Rice
35,069,475
Tractors for Agricultures
3,186,171
Fuels
30,715,395
IT & Computers
2,972,124
Electrical Machinery
(Heavy Fuel Generators)
25,198,000
Household furniture's
655,676
Aerials & Aerial reflectors 22,770,000
, Boilers, Machinery
Medicines, Antibiotics &
equipments
524,934
Alcohol & Tobacco
Vegetables, Fruits &
Cooking oil
7,456,999
Source: National Statistic Directorate
Timor-Leste
Country Risk Analysis
85,766

12. Exports Commodity
Commodity
Re Exports
Value
(in Kg)
Coffee
Quantity
(in USD)
9,941,963
8,290,612
Heavy
Containers
Source: National Statistic Directorate (2012)
Timor-Leste
Country Risk Analysis
26,021,000

13. Issues
status
Manatuto
Dili
Ermera
Manufahi
in %
in %
in %
in %
Food Consumption
Less than adequate
32.0
27.7
71.3
28.9
Housing
Less than adequate
27.7
23.1
62.6
45.4
Clothing
Less than adequate
16.0
21.2
31.8
21.2
Health Care
Less than adequate
19.2
15.1
56.2
22.5
Children education
Less than adequate
22.2
28.4
54.4
20.2
Household income
Less than adequate
69.0
56.2
86.8
69.1
Timor-Leste Country Risk Analysis

14. Circular
Flow
Timor-Leste
Country Risk Analysis

15. Timor-Leste
Circular
Flow
Timor-Leste
Country Risk Analysis

16. Conclusion
• Timor-Leste economy is high risk because:
– There are no factors of production.
– There are no alternative commodities to export
except coffee.
– The private sector relies on government projects.
– Government revenue depends on oil.
– There is no legal protection for local food
production.
Timor-Leste Country Risk Analysis