Timor-Leste Prime Minister restates government decision to opt for market economy

29 November 2005

Dili, Timor-Leste, 29 Nov – The Prime Minister of Timor-Leste, Mari Alkatiri reaffirmed Monday in Dili his government’s choice of a market economy for the country. Alkatiri was addressing an investment conference organized to promote foreign investment in Timor-Leste.

In his speech Alkatiri highlighted the steps already taken to make Timor-Leste a market economy, “We are aware of what competing countries have to offer. We know that we cannot and never wanted to adopt the measures of some countries that greatly subsidize their economies to maintain a certain costs artificially low, such as labor, fuel and electricity, among other things,” he said.

The Timorese economy “is based on the principle of market rules and is oriented by competition and competitiveness,” and because of the social and political conditions surrounding the country’s independence, which only occurred in 2002, Mari Alkatiri considered it was necessary to be creative and with that in mind the choice was a straightforward one.

“Creating a company in Timor-Leste and to operate a sustainable economic activity is at least 30% more expensive here than in neighboring countries. So, with the incentives package we have adopted, although it did not entirely fulfill our objectives, it at least partially reduced that 30% disparity to perhaps 15%,” he said.

At the same time it was decided to reduce production costs, both for the creation of new enterprises and for expanding existing companies.

The aim was to try to reduce the trade deficit caused by US$203 million in imports and exports, mainly if coffee, that total nom more than US$7 million Alkatiri told the conference.

Over 100 businessmen, representing 35 countries from various sectors, from Australia (11), Continental China and Macau (13), Portugal (five), United States, Kuwait and Indonesia (one each) took part in the two-day event. (macauhub)