Government of Timor-Leste considers withdrawing US$250 million from Oil Fund

11 March 2020

The Government of Timor-Leste on Wednesday in Dili plans to discuss the withdrawal of US$250 million from the country’s Oil Fund to strengthen the treasury account, said on Tuesday the interim Minister of Finance, Sara Lobo Brites, in statements to the press.

The minister also told Portuguese news agency Lusa that the proposal would be presented on Wednesday to the Council of Ministers and, if adopted, would be sent to Parliament for debate and approval.

Lobo Brites said last week that the Timorese government may face serious cashflow problems in May, and currently has only enough cash to finance public accounts in March and April, and “the balance in the Treasury account is approximately US$215 million.”

The proposal will be discussed at a time of renewed political tension, with the prime minister Taur Matan Ruak resigning over two weeks ago and uncertainty about whether and when there will be a new government, with the interim Minister stating that if the transfer of funds to the Treasury account is not approved, “the government has no money to work.”

The strengthening of the Treasury Account has, in recent years, been the focus of some controversy with different interpretations of the application of the budget and financial management law of the Oil Fund Law, according to Lusa.

The Timor-Leste Oil Fund had a capital of US$17.69 billion at the end of December 2019, according to the report for the fourth quarter of the year.

Gross cash inputs amounted to US$156.82 million, but outputs totalled US$552.48 million.

Most of these outputs – US$549 million – were due to transfers to the State Budget, according to the same document. (macauhub)