Timor-Leste’s is in its transformation into a fair, prosperous and self-sufficient nation, aim to build a modern and diversified economy burgeoned by a healthy, educated, secure and medium-high income-earning population by 2030.
Timor-Leste is establishing itself as a preferred destination for foreign investment, characterized by a fair and favorable business environment and one of the most attractive tax systems for business in the world.
Timor-Leste is strategically located in Southeast Asia, situated on the Western (Indonesia) part of the island and a 550 km north of Australia, the smallest and more eastern island of the Malay Archipelago. It includes the enclave of Oecusse-Ambeno, the islands of Ataúro and Jaco. It is the only Portuguese speaking country in Asia.
Strategic National Development Plan
Since 2011, a Strategic National Development Plan has been guiding Timor-Leste’s transformation into a fair, prosperous and self-sufficient nation, with an aim to, by 2030, build a modern and diversified economy burgeoned by a healthy, educated, secure and medium-high income-earning population.
Timor-Leste has adopted a Guide for Economic Development Reform (GRFE) 2015-2017, to create sustainable, efficient and effective bases of economic development in the country. The GRFE was proposed by the Minister of State, Coordinator of Economic Affairs (MECAE) and approved by the Council of Ministers on 24 November 2015. The six reforms are as follow:
Reform 1 - Land and Property Regulation
Reform 2 - Economic Infrastructure Development
Reform 3 - Labour Regulation and Development of Workforce
Reform 4 - Reform of the Business Environment
Reform 5 - Tax Reform (is Designed and Implemented by the Ministry of Finance)
Reform 6 - Reform of Investment Investment Regime
Reform 7 - Reform and Private Sector Development
Timor-Leste is a full-fledged member of the Community of Portuguese Speaking Countries, enabling access to a market of more than 250 million consumers in a three continents, for which more than 50 million are upper middle income.
The country has applied for accession to ASEAN (the Association of Southeast Asian Nations) in 2011, with ongoing investments and reforms paving the way for a closer integration in the coming years.
In April 2015, Timor-Leste has applied for membership of the World Trade Organization (WTO).
Timor-leste’s corporate income tax – 10% is the lowest in Southeast Asia. This further enhances by negotiable tax incentives for large projects, which may further improve business models.
Macro Economic Indicators
GDP 2015 : US$ 3,956 million
GDP per capita : US$ 3,330 (estimated 2015)
Real growth rate : 6,8% (estimated 2015)
Economic structure :
• Petroleum and gas 73%
• Public Administration 6%
• Agriculture 5%; Civil Construction 5%; Comerce 5%
• Real Estate 2%; Communication and Information 2%
• Manufacture Industry • Financial Activity • Various Services 1%
Export 2014 : US$ 23.0 M
Import 2014 : US$ 554.0 M
Inflation rate 2014 : 1%
Unemployment rate : 6,7%
Minimum Salary : US$ 115