Timor‐Leste economic survey: The end of petroleum income. Issue 2 (30th September 2021)

• Record Type: Journal Article
• Authors: Scheiner, Charles
• Other Names: Lin Vivian guestEditor.; Pangestu Tikki guestEditor.
• Is Part Of: Asia & the Pacific policy studies. Volume 8:Issue 2(2021)
• Page Start: 253
• Page End: 279
• Publication Date: 2021-09-30
• Subjects: economic survey -- oil and gas revenue -- Pacific economy -- Petroleum Fund -- Timor‐Leste; Policy sciences -- Asia -- Periodicals; Policy sciences -- Pacific Area -- Periodicals; Policy sciences -- Australia -- Periodicals; Political planning -- Asia -- Periodicals; Political planning -- Pacific Area -- Periodicals; Political planning -- Australia -- Periodicals; 320.6095
• DOI: 10.1002/app5.333
• Languages: English
• ISSNs: 2050-2680

Abstract

Abstract: As Timor‐Leste nears the end of its petroleum‐exporting era, the transition to a sustainable economy has become even more challenging due to partisan political competition, disastrous flooding and the pandemic. This article describes the current economic context, and deteriorating trends. After a brief discussion of the political situation and the impacts of COVID‐19, it explores expenditure and income trends in recent state budgets, with a particular focus on dependency on oil and gas revenues and their investments, which pay for 80% of state spending and may run out within a decade. It then assesses in detail revenue prospects from current and future oil and gas activities, including Greater Sunrise and the planned Tasi Mane petroleum infrastructure project. The analysis shows that it is highly likely that resource revenue will continue to decline. Diversification is not an option; it is the only way forward.