Tomas Freitas - Timor-Leste Country Risk Analysis

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Tomas Freitas - Timor-Leste Country Risk Analysis

  1. 1. Timor-Leste Country Risk Analysis: A Macroeconomic risk Tomas Freitas Timor-Leste Country Risk Analysis
  2. 2. Outline • • • • • Country & Economy Performance Transparency and Accountability Theoretical Framework Economy Growth ( the elements of GDP) Conclusion Timor-Leste Country Risk Analysis
  3. 3. Country & Economy Performance Item weight Source Population 1.2 Million NSD (2011) Life Expectancy 62.5 year HDR (2011) Child Mortality under five year old 56 Per 1000 live birth HDR (2011) Access Clean Water 35.7% HDR (2011) Access to Education (Primary 90% School) MoF (2012) Growth National Income 2,704 Million (USD) IMF (2010) GDP Per capita $805 (USD) HDR (2011) Real GDP Growth 9.5% ADB (2010) Urban Unemployment 42% MoF (2012) Rural Unemployment 80% MoF (2012) Inflation 12.4% MoF (2011) BOP (Current Account) 1,717 Million USD BCTL (2010) Savings +10 Billion USD BCTL (2012) Timor-Leste Country Risk Analysis
  4. 4. Timor-Leste Transparency and Accountability performance Index Period Rank Score Revenue Transparency 2010 12/40 70.5 Corruption Perceptions 2011 143/183 2.4/10 Judicial Independence 2010-2012 86/142 3.3/7 Rule of Law 2010 10% -1.2 Open Budget 2010 Minimal 34 Voice & Accountability 2010 49% 0.02 Control of Corruption 2010 18% 0.95 Human Development Report 2011 147/187 (Low) 0.495 Press Freedom 2011-2012 86/179 30.00 Source: Transparency International http://www.transparency.org/country#TLS Timor-Leste Country Risk Analysis
  5. 5. Theoretical Framework • Macroeconomic – Income Approach GDP: The total income earned by the household in a nation during a year Total Income = Rent + Wages + Interest + profit – Expenditures Approach GDP: the total amount spent on goods and services in a nation by households, firms, government and foreigners GDP = C + I + G + Xn) Timor-Leste Country Risk Analysis
  6. 6. GDP Growth Source: IMF, World Economic Outlook Timor-Leste Country Risk Analysis
  7. 7. Elements Of The GDP Fiscal Year Consumption Based on Consumer Price Index in Million US Dollar Investment Gov Exp in In Capital Asset (Million US Dollar) Health, Education, Agriculture, Infrastructure & Social Security Exports Imports Trade Balance in Million US Dollar 2004-05 107.5 - 52.3/79.0 105,645 146,108 -40,454 2005-06 107.5 - 46.1/112.0 43,451 109,127 -65,676 2006-07 120.0 - 142.9/328.6 60,685 100,802 -40,117 Transition 134.1 - 72.9/116.4 19,179 206,133 -186,954 2008 145.6 - 208.7/483.9 49,207 268,584 -219,377 2009 146.4 - 355.1/603.6 34,512 295,096 -260,584 2010 - 54 458.8/758.7 - - - 2011 - - 365/1,306.0 - - - 2012 - - 423.9/1,674.1 - - - Sources: Ministry of Finance & National Statistic Directorate Timor-Leste Country Risk Analysis
  8. 8. Elements of Consumption Source: National Statistic Directorate Data compiled from April 2011-April 2012 Timor-Leste Country Risk Analysis
  9. 9. Government Expenditures Sources: Ministry of Finance Timor-Leste Country Risk Analysis
  10. 10. Revenues contribution to State Budget Source: Ministry of Finance Timor-Leste Country Risk Analysis
  11. 11. Merchandise Import of Major commodities Commodity Value Commodity in US Dollar Value in US Dollar Vehicles (Cars & Motorbikes) 58,486,000 Construction materials 4,075,138 Rice 35,069,475 Tractors for Agricultures 3,186,171 Fuels 30,715,395 IT & Computers 2,972,124 Electrical Machinery (Heavy Fuel Generators) 25,198,000 Household furniture's 655,676 Aerials & Aerial reflectors 22,770,000 , Boilers, Machinery Medicines, Antibiotics & equipments 524,934 Alcohol & Tobacco Vegetables, Fruits & Cooking oil 7,456,999 Source: National Statistic Directorate Timor-Leste Country Risk Analysis 85,766
  12. 12. Exports Commodity Commodity Re Exports Value (in Kg) Coffee Quantity (in USD) 9,941,963 8,290,612 Heavy Containers Source: National Statistic Directorate (2012) Timor-Leste Country Risk Analysis 26,021,000
  13. 13. Issues status Manatuto Dili Ermera Manufahi in % in % in % in % Food Consumption Less than adequate 32.0 27.7 71.3 28.9 Housing Less than adequate 27.7 23.1 62.6 45.4 Clothing Less than adequate 16.0 21.2 31.8 21.2 Health Care Less than adequate 19.2 15.1 56.2 22.5 Children education Less than adequate 22.2 28.4 54.4 20.2 Household income Less than adequate 69.0 56.2 86.8 69.1 Timor-Leste Country Risk Analysis
  14. 14. Circular Flow Timor-Leste Country Risk Analysis
  15. 15. Timor-Leste Circular Flow Timor-Leste Country Risk Analysis
  16. 16. Conclusion • Timor-Leste economy is high risk because: – There are no factors of production. – There are no alternative commodities to export except coffee. – The private sector relies on government projects. – Government revenue depends on oil. – There is no legal protection for local food production. Timor-Leste Country Risk Analysis

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