Timor-Leste

Years

Targets and attainment

Classification

2002-23

referendum 1999 strongly favours independence from Indonesia, but followed by violence with destruction or closure of infrastructure, banks and other institutions, until Australian-led peace-keeping mission arrives followed by UN-led administration; USD adopted 2000 as sole legal tender, Indonesian rupiah initially still used for retail purposes, but coins (in centavos equal to USD cents) issued by Timor-Leste central bank from 2003; parliament elected August 2001, president 2002; formal independence 2002; economy slowly recovers, with basic (mainly foreign-owned) financial system, new fiscal institutions and banking and payments authority, which cannot lend to government or banks and has no monetary or exchange rate role; rupiah and other currencies phased out by 2003; oil and gas production from 2004 (which dominates activity, fiscal revenues and exports), Norwegian-type petroleum fund set up 2005 along with commitment to long-term fiscal sustainability policy; 2006-8 renewed periodic civil unrest, new UN peace-keeping mission (which remains till 2012); existing monetary and exchange rate regime regularly reaffirmed, on basis that introduction of national currency would require strong institutional capacity and well-functioning financial markets; banking remains accessible to only small part of population; banking and payments authority becomes central bank 2011; 2017-18 political deadlock impeded decision-making; Covid-19-related contraction 2020, moderate rebound 2021; oil and gas production coming to a natural end, wealth fund being depleted by recurring large fiscal deficits; statistical database initially very poor, broadly adequate by end of period

use of another sovereign’s currency UASC