Financial Regulation Compliance Urged to Change Course for Sustainable Economic Growth in Timor-Leste
Dili, Timor-Leste - A new report by the World Bank has emphasized the importance of prioritizing and improving public spending quality in Timor-Leste, citing it as a crucial step towards promoting inclusive and sustainable economic growth.
Public Expenditure Review Highlights Key Findings
The report, titled “Timor-Leste Public Expenditure Review”, highlights the need for better budgeting and resource mobilization to improve outcomes in key sectors such as health and education. Despite significant investments in these areas, the quality of service delivery remains poor, with high rates of child stunting and inadequate education infrastructure.
The Need for Change
If public expenditure continues to grow at its current pace, it could result in a large budget deficit that threatens fiscal sustainability. To address this issue, the World Bank is urging the government to increase domestic revenue collection and improve the efficiency of spending.
Minister’s Perspective
“We need to decelerate our current expenditure today rather than having to reverse it later when our petroleum wealth becomes scarce,” said Rui Augusto Gomes, Minister of Finance, Timor-Leste. “We must use our reserves wisely to support and diversify our economy and use our revenues more efficiently and effectively.”
Financial Regulation Compliance: A Key Factor
The report also emphasizes the importance of improving financial regulation compliance in Timor-Leste, stating that it is essential for maintaining a stable and sustainable economic growth. The report highlights that under current spending, the petroleum fund could be depleted by the end of the decade.
Policy Options to Increase Revenue Collection and Improve Efficiency
The report outlines policy options to help Timor-Leste increase revenue collection and improve efficiency of spending, including:
- Improving tax administration
- Increasing transparency and accountability in government spending
- Diversifying the economy
Access the Full Report
The full report is available online at www.worldbank.org/tl.
By addressing these challenges and implementing effective policy changes, Timor-Leste can ensure a more sustainable economic future for its citizens.