[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-111033-en":3,"doc-seo-111033-105":29,"detail-sidebar-cat-0-en-105":91},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},111033,7971461741311,"Ophelia","https://ap-avatar.wpscdn.com/avatar/74000253aff267980c6?x-image-process=image/resize,m_fixed,w_180,h_180&k=1779345379180704826",8,"Research & Report","Timor-Leste - Joint World Bank-IMF Debt Sustainability Analysis - April 2021","Timor-Leste’s joint World Bank–IMF debt sustainability analysis finds moderate risk of both overall and external debt distress, while applying judgment to reflect the Petroleum Sovereign Wealth Fund’s mitigating role. The outlook turns weaker than the 2019 Article IV assessment due to less favorable starting conditions, a downgrade in debt-carrying capacity, and projected breaches of critical external debt and debt-service thresholds under the baseline. Fiscal plans are unsustainable long term as the Petroleum Fund is expected to be gradually depleted; reforms in an alternative scenario can support fiscal and debt sustainability.","Public Disclosure Authorized Public Disclosure Authorized  \nINTERNATIONAL DEVELOPMENT ASSOCIATION  \nINTERNATIONAL MONETARY FUND  \nDEMOCRATIC REPUBLIC OF TIMOR-LESTE  \nJoint World Bank-IMF Debt Sustainability Analysis1  \nApril 2021  \nPrepared Jointly by the staffs ofthe International Development Association (IDA)  \nand the International Monetary Fund (IMF)  \nApproved by Marcello Estevão, and Hassan Zaman (IDA), Alfred Schipke and Geremia  \nPalomba (IMF)  \n\n| Timor-Leste: Joint Bank-Fund Debt Sustainability Analysis |  |\n| --- | --- |\n| Risk of external debt distress | Moderate |\n| Overall risk of debt distress | Moderate |\n| Granularity in the risk rating | Limited space to absorb shocks |\n| Application of judgement | Yes. Petroleum sovereign wealth fund is a strong mitigating factor for the country’s debt sustainability. |\n\nThe debt sustainability analysis indicates that Timor-Leste is at moderate risk of overall and external debt distress, with application of judgement, reflecting a projected increase in: (i) debt service payments as existing loan grace periods come to an end; and (ii) concessional borrowing to finance a large increase in public investment in infrastructure. This represents a downgrade from a low risk of debt distress at the time of the 2019 Article IV debt sustainability analysis, reflecting worse initial conditions and a downgrade in its debt carrying capacity from medium to weak. The present value of external debt-to-exports ratio and the debt service-to-exports ratio under the baseline are projected to breach their respective critical thresholds, triggering a high-risk mechanical rating for external and overall debt. However, the Petroleum Fund is large relative to projected debt levels and debt service requirements; and its assets are liquid and accessible, prompting the use of judgment to upgrade the risk assessment. Fiscal plans under the baseline are nonetheless unsustainable in the long term. Staff projects that the Petroleum Fund, which is the main source of funding of fiscal deficits, will be gradually depleted. Staff’s alternative scenario illustrates how fiscal and structural reforms can ensure both fiscal and debt sustainability.  \n1 The debt sustainability analysis follows the IMF and World Bank Staff Guidance Note on the Application of the Joint Fund-Bank Debt Sustainability Framework for Low-Income Countries (February 2018) . Timor-Leste’s debt-carrying capacity is assessed to be “weak” with composite indicator score of 2.669, which is based on the 2021 April World Economic Outlook and the 2019 Country Policy and Institutional Assessment.  \nPUBLIC DEBT COVERAGE  \n1. The coverage of public sector debt used in this report is public and publicly guaranteed debt. Timor-Leste’s public and publicly guaranteed external debt is held entirely by the central government. The coverage of public sector debt includes state-owned enterprise debt. Under the Public Debt Regime Law 2 , state-owned enterprises are not allowed to borrow for themselves and can only obtain financing via on-lending from the Ministry of Finance. The public sector only borrows externally, given a lack of domestic financing sources. The debt definition of the debt sustainability analysis is currency-based and the legal tender is the U. S. dollar.3  \n\n| Text Table 1. Timor-Leste’s Coverage of Public Debt |\n| --- |\n|  |\n|  |\n\nBACKGROUND ON DEBT  \n2. Timor-Leste’s net public asset position is currently strong due to oil-related savings accumulated in Petroleum Fund assets and low levels of public debt.  \n• The Petroleum Fund balance at end-2020 stood at $19 billion (1,213 percent of non-oil GDP), covering 271 months of goods and services imports. The Petroleum Fund balance increased by $1.3 billion in 2020 as investment income ($1.9 billion) and oil revenues ($0.3 billion) more than compensated for  \n2 According to the Public Debt Regime Law No. 13/2011, the Government of Timor-Leste, in particular, the Ministry of Finance, is the only e","cbCaidnu2jagDwvo","https://ap.wps.com/l/cbCaidnu2jagDwvo","pdf",912845,1,24,"English","en",105,"# Risk of debt distress\n## Risk assessment and judgment\n# Baseline projections and thresholds\n## Breaches and downgrade from 2019\n# Public debt coverage\n## Coverage definition and legal framework\n# Background on debt and fiscal position\n## Petroleum Fund assets and deficits\n# Macroeconomic forecasts and scenarios\n## Baseline versus reform assumptions","[{\"question\":\"What is the overall and external debt distress risk level for Timor-Leste?\",\"answer\":\"The analysis rates both overall risk of debt distress and risk of external debt distress as moderate. Judgment is applied to account for mitigating factors from the Petroleum Fund.\"},{\"question\":\"Why did the assessment weaken compared with the 2019 debt sustainability analysis?\",\"answer\":\"The analysis reflects worse initial conditions, a downgrade in debt-carrying capacity from medium to weak, and baseline projections that increase debt service pressures as grace periods end and concessional borrowing rises to fund infrastructure.\"},{\"question\":\"How does the Petroleum Fund affect the debt sustainability conclusion?\",\"answer\":\"The Petroleum Fund is large relative to projected debt and debt service needs, with liquid and accessible assets, leading the staff to upgrade the risk assessment using judgment. Nevertheless, baseline fiscal plans remain unsustainable and the fund is projected to be gradually depleted.\"}]",1784488234,60,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":86,"head_meta":88,"extra_data":90,"updated_unix":27},"timor-leste-joint-world-bank-imf-debt-sustainability-analysis-april-2021","",{"@graph":35,"@context":85},[36,53,68],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/timor-leste-joint-world-bank-imf-debt-sustainability-analysis-april-2021/111033/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":62,"encodingFormat":60,"isAccessibleForFree":63,"interactionStatistic":64},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-22","2026-07-19",true,{"@type":65,"interactionType":66,"userInteractionCount":20},"InteractionCounter",{"@type":67},"ViewAction",{"@type":69,"mainEntity":70},"FAQPage",[71,77,81],{"name":72,"@type":73,"acceptedAnswer":74},"What is the overall and external debt distress risk level for Timor-Leste?","Question",{"text":75,"@type":76},"The analysis rates both overall risk of debt distress and risk of external debt distress as moderate. Judgment is applied to account for mitigating factors from the Petroleum Fund.","Answer",{"name":78,"@type":73,"acceptedAnswer":79},"Why did the assessment weaken compared with the 2019 debt sustainability analysis?",{"text":80,"@type":76},"The analysis reflects worse initial conditions, a downgrade in debt-carrying capacity from medium to weak, and baseline projections that increase debt service pressures as grace periods end and concessional borrowing rises to fund infrastructure.",{"name":82,"@type":73,"acceptedAnswer":83},"How does the Petroleum Fund affect the debt sustainability conclusion?",{"text":84,"@type":76},"The Petroleum Fund is large relative to projected debt and debt service needs, with liquid and accessible assets, leading the staff to upgrade the risk assessment using judgment. Nevertheless, baseline fiscal plans remain unsustainable and the fund is projected to be gradually depleted.","https://schema.org",{"og:url":51,"og:type":87,"og:title":13,"og:site_name":58,"og:description":14},"article",{"robots":89,"canonical":51},"index,follow",{"doc_id":7,"site_id":24},{"code":4,"msg":5,"data":92},[93,97,101,105,109,114,119,122,127,130,134],{"id":20,"doc_module":4,"doc_module_name":45,"category_name":94,"show_sort_weight":95,"slug":96},"Story & Novel",90,"story-novel",{"id":46,"doc_module":4,"doc_module_name":45,"category_name":98,"show_sort_weight":99,"slug":100},"Literature",80,"literature",{"id":52,"doc_module":4,"doc_module_name":45,"category_name":102,"show_sort_weight":103,"slug":104},"Exam",70,"exam",{"id":106,"doc_module":4,"doc_module_name":45,"category_name":107,"show_sort_weight":28,"slug":108},5,"Comic","comic",{"id":110,"doc_module":4,"doc_module_name":45,"category_name":111,"show_sort_weight":112,"slug":113},6,"Technology",50,"technology",{"id":115,"doc_module":4,"doc_module_name":45,"category_name":116,"show_sort_weight":117,"slug":118},7,"Healthcare",40,"healthcare",{"id":11,"doc_module":4,"doc_module_name":45,"category_name":12,"show_sort_weight":120,"slug":121},30,"research-report",{"id":123,"doc_module":4,"doc_module_name":45,"category_name":124,"show_sort_weight":125,"slug":126},9,"Religion & Spirituality",20,"religion-spirituality",{"id":125,"doc_module":4,"doc_module_name":45,"category_name":128,"show_sort_weight":125,"slug":129},"World Cup","world-cup",{"id":131,"doc_module":4,"doc_module_name":45,"category_name":132,"show_sort_weight":131,"slug":133},10,"Lifestyle","lifestyle",{"id":135,"doc_module":4,"doc_module_name":45,"category_name":136,"show_sort_weight":106,"slug":137},19,"General","general"]