ADB's Work in Timor-Leste

Following a robust economic rebound in 2022 and a subsequent slowdown in 2023, Timor-Leste’s economic growth regained momentum in 2024, fueled by expansionary fiscal policies and steady consumption. After reaching a decade- high peak in 2023, inflation has moderated as price pressures eased among key trading partners.

The Asian Development Bank (ADB) has been instrumental in addressing infrastructure bottlenecks and institutional constraints in Timor-Leste, contributing to paving the way for sustainable development. ADB’s expanded project portfolio now bolsters the Government of Timor-Leste’s initiatives to create a favorable environment for private sector growth and economic diversification.

Sovereign operations. As of 31 December 2024, ADB has committed 81 public sector loans, grants, and technical assistance totaling 766ドル million to Timor-Leste. ADB’s current sovereign portfolio in Timor-Leste includes 14 loans and 1 grant worth 580ドル.42 million.

Cumulative disbursements. Cumulative sovereign loan and grant disbursements to Timor-Leste amount to 302ドル million. These were financed by regular and concessional ordinary capital resources, the Asian Development Fund, and other special funds.

Historically, ADB concentrated its efforts on transport projects, particularly the rehabilitation and upgrading of national roads to improve urban-rural connectivity. However, since 2021 ADB has diversified its portfolio to encompass more sectors including transport, water, urban development, energy, agriculture, and rural development.

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In 2024, ADB committed a total of 16ドル.6 million in grants for the Rural Resilience and Livelihood Improvement Sector Project. The project aims to benefit about 46,000 people. It will improve access to water, enhance farm productivity through climate-smart approaches, strengthen market linkages, and develop diversified livelihood opportunities.

ADB is providing transaction advisory services to promote public–private partnerships in Timor-Leste in several areas including the development of a solar power park, implementation of unique identification systems, enhancement of solid waste management, and establishment of carbon credit markets.

ADB, plays a pivotal role in regional cooperation, supporting Timor-Leste’s ongoing efforts to join the Association of Southeast Asian Nations (ASEAN). The bank has also supported the country’s accession to the World Trade Organization in August 2024.

ADB has been providing regional and country-specific technical assistance and grants across various sectors, including enhancing rural livelihoods through coffee and agroforestry, developing gender-responsive judicial systems, improving social protection, offering emergency assistance, building public and private sector capacities, and improving public sector management.

Operational challenges. Project implementation in Timor-Leste faces challenges related to institutional and human resource capacity, interagency coordination, and procurement practices. The capacity for medium-term public investment planning and the ability to design and implement large projects are still developing. ADB assists the government in ensuring project readiness, strengthening processes by supporting standard operating procedures for investment projects, improving service delivery, and enhancing the technical capacities of government agencies.

Sound legal, regulatory, and institutional frameworks are essential to ensure sustainable and efficient operations. In collaboration with the government, ADB has identified key project management issues and proposed solutions to help establish effective systems for investment project management. The bank also provides systematic capacity-building support for infrastructure project management, workforce development, and skills enhancement.

Knowledge Work

ADB’s country knowledge plan for Timor-Leste focuses on strengthening infrastructure management, human capital, private sector development, and regional economic integration. The bank has been supporting capacity development through various projects, providing training and embedded support within the government and other state entities.

Knowledge products include sector and technical studies, scoping assessments, strategies and plans that directly support the preparation and delivery of pipeline projects, and capacity and skills development. Knowledge events, organized in collaboration with government counterparts, development partners, and academia, cover a wide range of areas, including procurement and contract management; environmental safeguards; women’s economic empowerment; Timor-Leste’s accession to ASEAN; macroeconomic management; the financial sector; micro, small, and medium-sized enterprises; and rural development.

ADB Projects in Timor-Leste Project data sheets for loans, grants, TAs

Financing Partnerships

Financing partnerships enable ADB’s financing partner governments or their agencies, multilateral financing institutions, and private organizations to participate in financing ADB projects. The additional funds provided may be in the form of loans and grants, technical assistance, and nonsovereign cofinancing.

Cumulative cofinancing commitments in Timor-Leste:

• Sovereign cofinancing: 172ドル.89 million for 7 investment projects and 15ドル.38 million for 8 technical assistance projects since 2007

In 2024, Timor-Leste received grant cofinancing from several funds and institutions for the Rural Resilience and Livelihood Improvement Sector Project, including 4ドル.59 million from the Global Environment Facility, 3ドル million from the Japan Fund for Prosperous and Resilient Asia and the Pacific, 2ドル.5 million from the Community Resilience Partnership Program Trust Fund under the Community Resilience Financing Partnership Facility, and 500,000ドル from the Ireland Trust Fund for Building Climate Change and Disaster Resilience in Small Island Developing States.

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Future Directions

ADB’s work in Timor-Leste will remain focused on advancing knowledge systems, fostering innovation, and providing technical expertise in addition to traditional financial support. The country partnership strategy will continue to steer the development of climate-resilient infrastructure, create an enabling environment for economic diversification, and promote a sustainable non-petroleum sector by improving basic service delivery and enhancing the business environment. Furthermore, the strategy will facilitate economic diversification into agriculture and skills development, enhance private sector capacity, advance information and communications technology, and promote regional cooperation and economic integration.

Last updated: 5 May 2025

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