18 March 2020

Economics of Education / Ekonomiku Edukasaun nian

Tetum iha kraik
On 4 March 2020, the Institute Of Business and Monash University hosted a public discussion on “The Economics of Education”. Monash Professor Brett Inder presented his research findings, and the responding panel included Rui Gomes (also article), Berta Antonieta of La’o Hamutuk, Jose Monteiro of the Timor-Leste Coalition for Education, and IOB Professor Pedro Ximenes. (Click on each name to download their presentation.)

All presenters agreed that the government should invest more in education in Timor-Leste. Brett and Rui both discussed the financing of the education itself, and how investing in education will create human capital, resulting in economic benefits. Rui also discussed how Timor-Leste falls behind in international standardized tests, while Brett explained equity in access to education – that education is not only a classroom experience, and that unequal access results from parents’ income and location. Berta explained that education is not only to produce human capital and employment, but also improves the quality of people’s lives. The government should repair infrastructure, train teachers, and improve the curriculum. From her personal experience in a small class with only 20 students; with well-trained teachers in adequate infrastructure, these improvements would bring Timor-Leste up to international norms.

Ministries of Education have already made progress, especially by using Tetun as the language of instruction and curriculum. However, Timor-Leste’s investment in education remains at half the level of similar countries.
=====================
Iha 4 Marsu 2020, Institutu Bisnis (IOB) no Universidade Monash organiza diskusaun públiku kona-ba “Ekonomia Edukasaun nian”. Professor Monash nian Brett Inder halo aprezentasaun ba nia rezultadu peskiza, no panel responde ba tópiku refere, konsiste husi Rui Gomes (ho palestra), Berta Antonieta husi La’o Hamutuk, Jose Monteiro husi Koligasaun ba Edukasaun iha Timor-Leste no Pedro Ximenes Professor husi IOB. (Bele kliik iha sira nia naran ne’e hodi download aprezentasaun sira nian.)

Aprezentadór hotu-hotu konkorda katak governu presiza investe iha edukasaun iha Timor-Leste. Brett no Rui diskute kona-ba finansiamentu husi edukasaun no oinsá investe iha edukasaun bele kria kapitál umanu, no bele hamosu benefísiu ekonómiku. Rui mós diskute oinsá Timor-Leste nia valór ki’ik liu uainhira foti padraun teste international sira, no iha tempu hanesan Brett esplika katak asesu ba edukasaun hanesan ekidade ida, edukasaun la’ós iha klase laran de’it no dezigualdade asesu ba edukasaun mosu depende ba inan aman nia vensimentu no fatin jeográfiku. Berta esplika katak, edukasaun la’ós atu prodús kapitál umanu no servisu ho saláriu de’it, maibé mós aumenta kualidade ema moris nian. Governu presiza hadi’a infrastrutura, fornese formasaun ba manorin sira, no hadi’ak curriculum. Husi nia esperiénsia rasik, klase ho estudante na’in 20, manorin na’in ne’ebé hetan formasaun metin iha infrastrutura ida metin, buat hirak ne’e bele foti Timor-Leste hodi bele kompete iha teste padraun internasionál sira.

Ministériu Edukasaun sira halo ona progresu balun, liuliu iha uza Tetun hanesan lingua manorin no uza iha kurríkulu. Maske nune’e, Timor-Leste nia investimentu iha edukasaun nafatin sorin balun de’it kompara ho nasaun ne’ebé hanesan.

13 March 2020

Akontesimentu Ekonomia Global fó impaktu boot ba Timor-Leste

Bele download PDF or link to English version.  Atualiza iha loron 14 no 31 Marsu; hare iha kraik.
Hahú husi 2015, Timor-Leste nia reseita estadu iha dependénsia ba rendimentu husi investimentu osan ne’ebé rai iha Fundu Petrolíferu, la’ós ona osan husi royalties no taxa husi ekstrasaun no esportasaun mina no gás.

Haree ba kondisaun dependénsia ba investimentu ne’e, La’o Hamutuk deside atu buka hatene oinsá mudansa ekonomia no merkadu finanseiru global sei afeta ba kapasidade no estabilidade finanseira husi governu Timor-Leste nia operasaun sira. Maske ita labele influénsia eventu ida ne’e, ita presiza komprende kona-ba eventu sira ne’e.

Artigu ne’e hanesan analiza prelimináriu kona-ba oinsá mudansa sira ne’ebé foin mosu lalais ne’e – husi 12 Fevreiru too 12 Marsu – fó impaktu ba ita nia Fundu Petrolíferu (FP).

Presu ekidade tun

Merkadu ekidade (asoens / stocks) iha Estadus Unidus no nasaun sira seluk tun kuaze 26% durante loron 30 ikus ne’e. Fundu Petrolíferu iha ekidade ho valór kuaze biliaun $6.6 iha fin 2019.  Tanba ne’e, ita lakon kuaze biliaun $1.7 valór merkadu husi ita nia asoens. Maibé, merkadu sempre iha flutuasaun (tun-sa’e), no ita la presiza fa’an ita nia asoens sira agora. Se situasaun iha merkadu sai di’ak fali (hanesan akontese iha 2019), ita sei lakon osan ki’ik liu, maibé se merkadu kontinua tun (hanesan akontese iha 2008), ita sei lakon osan barak liu tan.

Timor-Leste nia Fundu Petrolíferu mak úniku iha mundu ne’ebé la lakon osan durante krize ekonómiku global iha 2008, tanba ita la investe iha asoens. (Nasaun Noruega lakon kuaze biliaun $90.) Iha 2010, bainhira halo revizaun ba lei Fundu Petrolíferu hodi bele uza Fundu ne’e barak liu ba sosa asoens, La’o Hamutuk husu “Oinsá Governu Timor-Leste bele responde ba preokupasaun publiku no politikus nain sira seluk wainhira ita nia fundu nia kapital sei lakon tamba deit labele kontrola merkadu, ka tamba desizaun ida be ladiak husi jestor eksternal ida? Oinsa ita bele asegura katak ita sei la sosa bainhira presu sae no fan bainhira nia presu tun?”

Mezmu ita la fa’an ita nia asoens, balansu iha FP nafatin uza atu kalkula Rendimentu Sustentável Estimativa (RSE) ne’ebé determina osan montante hira mak bele foti ho sustentável husi Fundu Petrolíferu. Redusaun biliaun $1.7 iha balansu FP sei hamenus RSE kuaze tokon $51 – kuaze dala-rua despeza estadu nian ba agrikultura kada tinan.

Taxa funan (taxa de juros) tun

Fundu Petrolíferu barak liu mak investe iha títulu husi governu sira, inklui biliaun $7.9 (iha fin 2019) iha títulu ne’ebé fó sai husi Tezouru Estadu Unidus nian, no biliaun $1.6 iha nasaun seluk. Taxa rendimentu ba médiu-prazu iha títulu Estadu Unidus nian tun too menus husi metade nivel uluk nian. Tinan kotuk, Fundu Petrolíferu hetan tokon $420 iha funan no dividendu,3 no ida ne’e bele tun too tokon $200 se bainhira taxa hirak ne’e kontinua hanesan agora ne’e. Se sira ne’e tun ba nafatin, Timor-Leste sei simu funan no dividendu ki’ik liu tan.

Presu mina tun

Maski esportasaun mina no gás la sai ona hanesan Timor-Leste nia fonte rendimentu prinsipál (no karik sei para total iha tinan tolu nia laran), Fundu ida ne’e nafatin sei simu reseita balu husi esportasaun mina no gás. Tinan kotuk, Ministériu Finansa projeta katak reseita husi mina no gás iha 2020 sei too tokon $595, bazeia ba espetasaun presu mina Brent nian, $62 kada barríl. Maibé, iha 13 Marsu presu mina mak $33 kada barríl. Se presu estabiliza nafatin iha maizumenus $35, reseita petróleu iha 2020 sei la too metade husi Ministériu nia projesaun, no RSE sei tun kuaze tokon $12. Se presu tun liu tan, nia impaktu sei aat liu tan.

Presu mina ne’ebé ki’ik, sei limita dezenvolvimentu petróleu iha mundu tomak, inklui Timor-Leste. Se presu kontinua ki’ik nafatin, projetu sira se fó lukru menus ba kompañia sira, no Bayu-Undan bele para produsaun lalais liu duké 2022, tuir saida mak sira planu ona. (Ida ne’e akontese ona ba Kitan iha 2015).

Kompañia no investór sira sei avalia fila fali valor ekonomia husi kada projetu iha futuru – inklui esplorasaun iha rai maran (onshore), Buffalo, Chuditch, Greater Sunrise no Tasi Mane – iha posibilidade atu atraza ka kansela. Avizu atu oferese fatin ba halo projetu (bidding round) ne’ebé ANPM daudaun ne’e halo hela sei hetan interese menus liu, tanba kompañia sira lakohi atu hahú ka investe iha projetu foun bainhira sira laiha serteza katak sira sei hetan lukru. 

Konkluzaun

Se presu no taxa funan nian ne’ebé diskute iha leten la sai aat liu (ka di’ak liu) durante tinan ida ne’e nia laran, too tinan 2020 nia rohan Timor-Leste nia investimentu Fundu Petrolíferu sei lakon loloos (net loss) kuaze biliaun $1.5. Ida ne’e biliaun rua menus manán tokon $640 ne’ebé Ministériu Finansa estimatiza iha proposta orsamentu 2020 nian. Aleinde ne’e, royalty no taxa husi mina no gás sei ki’ik liu tokon $300 husi saida mak Governu projeta ona ‘ho prudente.’ Lakon hirak ne’e bele kontinua iha tinan hirak tuir mai.

Tinan kotuk, La’o Hamutuk estimatiza katak Fundu Petrolíferu bele mamuk iha 2028, mezmu se ita la uza Fundu ne’e hodi selu ba kustu kapitál projetu Tasi Mane nian. Se tendénsia global ne’e mantén nafatin, FP sei mamuk lalais liu tan tinan balu.

Governu VIII sesante hakarak foti tokon $250 husi Fundu Petrolíferu tanba funsionamentu ba mákina estadu labele kontinua se laiha osan. Hahú iha Janeiru (hanesan iha 2018), despeza estadu ne’ebé la’o neineik hafraku ekonomia iha territóriu Timor-Leste, halo ema kiak sira sai kiak liu tan. Redusaun maka’as atividade ekonomia hatudu katak populasaun sira depende maka’as ba estadu nia despeza husi Fundu Petrolíferu – no hatudu frakeza boot husi ita nia ekonomia.

Ameasa ne’ebé oras ne’e mosu ba Fundu ne’e nia ezisténsia médiu-prazu la’ós buat foun ida, no bele sai aat liu tan tanba mudansa klimátika no redusaun iha balansu Fundu nian. Ameasa hirak ne’e fó hanoin fali mai ita katak Timor-Leste iha urjénsia tebes atu diversifika nia ekonomia ne’ebé la’ós petróleu ka investimentu. Ita liu ona tempu ita tenke investe iha ita nia labarik sira nia saúde no edukasaun, ho nune’e ita nia produtividade, sustentabilidade no ekonomia ne’ebé ekitável – agrikultura, indústria ki’ik no eko-turizmu – bele hakbiit ita nia povu sira atu bele moris ho prospero. Ida ne’e mak dalan úniku atu atinje Fundu Petrolíferu nia objetivu atu benefisia jerasaun sira tuir mai.

Glosáriu:

  • Royalty: rendimentu ne’ebé estadu hetan husi produsaun mina no gas iha tasi okos ka rai maran.
  • Ekidade: asoens (stocks) ne’ebé investe iha kompañia sira, fa’an iha merkadu internasionál
  • Títulu: Hanesan instrumentu ba rendimentu fiksa ne’ebé reprezenta fó empréstimu ruma, espesialmente ba Governu E.U. no nasaun sira seluk
  • Dividendu: distribuisaun ne’ebé rekompensa husi lukru balu ne’ebé kompañia na’in hetan no selu balu ba na’in husi asoens. 
  • Kustu Kapitál: despeza ne’ebé tenke halo atu harii projetu ida

Atualiza 14 Marsu 2020

Ami hakerek artigu iha leten iha loron 13 Marsu 2020, bazeia ba presu no taxa sira bainhira oras negósiu remata iha loron Kinta, 12 Marsu. Loron ida tuir mai, númeru tolu ne’ebé ita uza atu halo projesaun sira hadi’ak uitoan, no montante ne’ebé Fundu Petrolíferu sei lakon agora mak biliaun $1.8, menus husi lakon biliaun $2.3 ne’ebé ami kalkula horiseik. Númeru sira ne’e sei muda loron-loron, no bele sai di’ak liu ka aat. Ita-boot bele hetan dadus husi:

Atualiza 31 Marsu 2020

Trimestre ikus mak monu iha fulan ida ne’e nia rohan, situasaun merkadu asoens iha Estadus Unidus aat liu dezde 2008. Situasaun iha Fundu Petrolíferu hetan aat liu iha 23 Marsu nia laran, maibé hafoin di’ak uitoan iha fulan ne’e nia rohan, to’o hanesan ho nivel ida ne’ebé artigu ida ne’e orijinálmente hakerek. Se bainhira situasaun ne’e nafatin la iha mudansa durante periodu 2020, balansu Fundu iha tinan ikus sei iha kuaze biliaun $1.9 menus liu kompara ho saida mak espekta iha inísiu tinan ida ne’e. (Artigu orijinál uza 12 Fevereiru hanesan referénsia; hahú husi pontu inísiu ne’e lakon ona rendimentu kuaze biliaun $2.1.)

Relatóriu mensal BCTL iha fulan Fevreiru hatudu balansu Fundu ne’ebé tuun ba tokon $344 durante fulan Fevreiru. Maske relatóriu fulan Marsu nian seidauk hasai, La’o Hamutuk estimatiza katak ida ne’e sei tuun ba tokon $500.

Ba Timor-Leste, bainhira folin mina ne’ebé kontinua tuun sei sai preokupasaun boot liu tan, no peritu sira hanoin katak ida ne’e bele tun to’o menus $20/barríl. Reseita husi kampu Bayu-Undan durante 2021-2023 sei menus husi montante tokon $260 hanesan ne’ebé sira antisipa ona. Ba tempu naruk, projetu petróleu ne’ebé iha planu hahú tiha ona – inklui Buffalo, atividade iha rai laran, Chuditch no Greater Sunrise – sei labele hetan lukru sufisiente atu justifika sira nia kapitál investimentu, no sei la kontinua atu dezenvolve; atu hanesan mós ho projetu sira iha mundu tomak ne’ebé kanseladu.

Atualiza 1 Maiu 2020

Durante fulan Abril, merkadu asoens iha Estadus Unidus sa’e maka’as liu kompara ho fulan sira seluk durante tinan 33 nia laran, ne’ebé konsege rekupera fila fali maizumenus 60% husi lakon sira ne’ebé akontese iha médiu Fevereiru too iha semana datolu Marsu. Tanba impaktu ekonomia husi surtu sei kleur atu remata, analista sira preokupa katak rekuperasaun ne’e sei la kontinua.

Mina nia folin no taxa funan iha títulu Estadu Unidus tuun uitoan durante Abril. Se situasaun hanesan iha 30 Abril kontinua nafatin too tinan 2020 nia rohan, balansu Fundu Petrolíferu ne’e nian iha tinan nia rohan sei menus liu maizumenus biliaun $1.25 husi espetasaun iha inísiu tinan ida ne’e.

Balansu Fundu Petrolíferu iha fin Marsu mak biliaun $17.03, tuun tokon $476 durante fulan Marsu, no tokon $663 ki’ik liu kompara ho balansu iha inísiu 2020. Laiha levantamentu osan iha fulan Marsu. Embora balansu ba fulan Abril sa’e (dadus seidauk disponivel), manán hirak ne’e sei limita fali ho levantamentu tokon $250 atu finansia Fundu Espesiál Covid-19 no funsionamentu regular governu nian.

Maske situasaun merkadu asoens rekupera fali husi pontu ida ki’ik liu, ida ne’e nafatin sei tuun-sa’e no bele tuun liu tan, tanba surtu Covid-19 ne’e sei kontinua ba fulan barak tan.

Ba Timor-Leste, mina nia folin ne’ebé kontinua tuun ho la serteza sai preokupasaun boot ba oin, no peritu barak espekta mós katak folin mina kontinua no bele ki’ik liu $20/barrel ba fulan ka tinan balu. Rendimentu ne’ebé sei mai husi Bayu-Undan iha 2021-2023 sei la too tokon $260 ne’ebé projeta ona. Ba tempu naruk, projetu petroleum ne’ebé iha ona planu – inklui Buffalo, rai leten, Chuditch no Greater Sunrise – dalaruma sei la fó lukru nato’on atu justifika investimentu kapitál no bele la realiza; projetu sira hanesan ne’e barak iha mundu tomak mak kansela ona. Fundu Petrolíferu tokon $650 ne’ebé fó empresta ba TimorGap atu bele sosa asoens iha kampu Greater Sunrise nian, ne’ebé nafatin tama iha konta balansu, dalaruma sei la selu fila fali.

Aleinde ne’e, nasaun barak mak prolonga ka adia sira nia avizu atu oferese fatin ba esplorasaun (bidding round), maski ANPM nafatin iha esperansa no atu hetan aplikasaun molok fulan Outubru.

Balansu iha Fundu Petrolíferu sei tuun liu tan iha 2020 – tanba retornu negativu investimentu nian no levantamentu estraordináriu hodi responde ba surtu Covid-19 – no dalaruma sei laiha tan rendimentu petrolíferu hodi aumenta fila fali ba Fundu Petrolíferu. Oinsá Timor-Leste sei finansia nia governu hafoin buat hotu fila fali ba “normal”?

Atualiza 1 Junu 2020

Global economic developments hit Timor-Leste hard

Download English PDF of this article ka verzaun Tetum husi iha ne'e
See updates through 1 June below, with current graphs.

Since 2015, Timor-Leste’s state revenues have depended on income earned from investing the money saved in the Petroleum Fund, rather than on royalties and taxes from extracting and exporting oil and gas.

In this investment-dependent condition, La’o Hamutuk decided to look into how global economic and financial market changes will affect the financial capacity and stability of Timor-Leste’s government operations. Although we cannot influence these events, we need to understand them.

This article is a preliminary analysis of how recent changes – from 12 February to 12 March 2020 – are impacting our Petroleum Fund (PF).

Falling equity prices

Equity (stock) markets in the U.S. and other countries dropped about 26% during the last 30 days. The PF owned about $6.6 billion in equities at the end of 2019. Therefore, we have lost about $1.7 billion in the market value of our stocks. However, the market is very volatile, and we do not need to sell our stocks right now. If the market bounces back (as it did in 2019), we will lose less money, but if it continues to fall (as it did in 2008), we could lose a lot more.

Timor-Leste’s Petroleum Fund was the only one in the world which didn’t lose money during the 2008 global economic crisis, because we were not invested in stocks. (Norway lost about $90 billion.) In 2010, when the Petroleum Fund Law was being revised to allow more of the Fund to be used to buy stocks, La’o Hamutuk asked "How will Timor-Leste’s Government respond to opposition and public concern when the principal of the Petroleum Fund loses value due to market forces outside their control, or because of a poor decision by an external manager? How can we make sure that we don’t buy when prices are high and sell when they are low?"

Even if we don’t sell the stocks, the balance in the PF is used to calculate the Estimated Sustainable Income (ESI) guideline for how much can be withdrawn sustainably from the Petroleum Fund. A fall of $1.7 billion in the Fund’s balance reduces ESI by $51 million – about twice as much as the State spends on agriculture every year.

Falling interest rates

Most of the Petroleum Fund is invested in government bonds, including $7.9 billion (as of the end of 2019) in those issued by the United States Treasury, and $1.6 billion in other countries.  Yield rates of medium-term U.S. bonds have dropped to less than half of their previous levels. Last year, the Petroleum Fund received $420 million in interest and dividends, and this could drop to $200 million if rates stay where they are.  If they fall further, Timor-Leste will receive even less in interest and dividends.

Falling oil prices

Although oil and gas exports are no longer Timor-Leste’s main source of income (and may end entirely in about three years), the Fund still receives some revenue from them. Last year, the Ministry of Finance projected that oil and gas revenues in 2020 would be $595 million, based on an expected Brent oil price of $62 per barrel. However, on 13 March the price was $33. If prices stabilize at around $35, petroleum revenues in 2020 will be less than half of what the Ministry projected, and the ESI would drop by about $12 million. If they fall further, the impact will be even more severe.

Low oil prices will restrict petroleum development across the globe, including in Timor-Leste. If they stay low, projects will be less profitable for companies, and Bayu-Undan could stop production even earlier than 2022, as is currently planned. (This happened with Kitan in 2015.)

Companies and investors will reassess the economics of every future project – including on-shore exploration, Buffalo, Chuditch, Greater Sunrise and Tasi Mane – possibly leading to delays or cancellations. The bidding round that ANPM is currently conducting may attract less interest, because companies hesitate to embark on or invest in new projects when they are uncertain that they will make money.

Conclusion

If the prices and interest rates discussed above don’t get any worse (or better) during the rest of this year, by the end of 2020 Timor-Leste’s Petroleum Fund’s investments will have a net loss of about $1.5 billion, more than two billion lower than the $640 million gain the Ministry of Finance estimated in the proposed 2020 budget. In addition, oil and gas royalties and taxes will be $300 million less than the Government ‘prudently’ projected. The losses could continue in future years.

Last year, La’o Hamutuk projected that the Petroleum Fund could be empty by 2028, even if it is not used to pay capital costs of the Tasi Mane project. If current global trends persist, this will happen several years sooner.

The outgoing VIII Government intends to withdraw $250 million from the Petroleum Fund because the machinery of the state cannot continue to function without it. Since January (as in 2018), slower state spending has weakened Timor-Leste’s entire economy, making poor people even poorer. This reduced economic activity underscores how much our population depends on the state spending money from the Petroleum Fund – and how weak the rest of our economy is.

The recent threats to the Fund’s medium-term survival are not new, and could become even worse due to climate change and the reduced balance in the Fund. They remind us that Timor-Leste urgently needs to diversify its economy away from petroleum and investments. It is long past time to invest in our children’s health and education so that our productive, sustainable and equitable economy – agriculture, light industry and eco-tourism – can enable our people to survive and thrive. That is the only way to achieve the Petroleum Fund’s promise to benefit future generations.

Update, 14 March 2020

The above article was written on 13 March 2020, based on prices and yield rates at the close of business on Thursday 12 March. The following day, all three indices used in these calculations improved, and the drop in Petroleum Fund revenues became $1.8 billion, less than the $2.3 billion loss we calculated the day before. These numbers will change every day, and could get better or worse. The data is available at:

Update, 31 March 2020

The end of the month was the end of the quarter, the worst for the U.S. stock market since 2008. The situation for the Petroleum Fund got much worse around 23 March, but recovered slightly by the end of the month, to about the same level as when the article above was originally written. If things stay unchanged for the rest of 2020, the Fund's balance at the end of the year will be about $1.9 billion less than was expected at the beginning of the year. (The previous article used 12 February as a reference; from that starting point the lost income is about $2.1 billion.)

The monthly BCTL report for February showed a drop in the Fund balance of $344 million during that month. Although the March report is not yet released, La'o Hamutuk estimates that it will show a further drop of $500 million.

For Timor-Leste, the continuing fall of the oil price is a more lasting worry, and many experts expect it to drop well below $20/barrel. Bayu-Undan's remaining revenue in 2021-2023 will be much less than the $260 million that has been projected. For the longer term, other petroleum projects on the drawing board -- including Buffalo, onshore, Chuditch and Greater Sunrise -- may not be profitable enough to justify the capital investment, and may not happen at all, as many other oil projects and contracting rounds around the world are being cancelled.

Update, 1 May 2020

During April, the U.S. stock market had its strongest month in 33 years, recovering about 60% of its losses between mid-February and the third week of March.

Oil prices and interest rates on U.S. bonds fell only slightly during April. If things stay as they were on April 30 for the rest of 2020, the Fund’s balance at the end of the year will be about $1.25 billion less than was expected at the beginning of the year.

The Petroleum Fund Balance at the end of March was $17.03 billion, a drop of $476 million during the month, and $663 million lower than at the beginning of 2020. No money was withdrawn in March. Although the balance went up to $17.60 billion in April, gains were limited by a $250 million withdrawal to finance the Covid-19 Special Fund and regular government operations.

Here’s how the components of the calculations in this blog did during the first four months of 2020. Although the stock market has recovered from its lowest point, it is still very volatile and could fall further, as the Covid-19 pandemic will continue for months.

For Timor-Leste, the continuing erratic drop in the oil price is a more lasting worry, and many experts expect that it could stay at or below $20/barrel for months or years. Bayu-Undan’s remaining revenue in 2021-2023 will be much less than the $260 million that had been projected. For the longer term, petroleum projects on the drawing board -- including Buffalo, onshore, Chuditch and Greater Sunrise -- may not be profitable enough to justify their capital investment and may not happen at all; similar projects around the world are being cancelled. The Petroleum Fund’s $650 million loan so that TimorGAP could buy participation in Greater Sunrise, which is still counted in its balance, may never be repaid.

In addition, many countries are extending or delaying their bidding rounds for new oil and gas exploration, although ANPM still hopes to get bids before October.
The Petroleum Fund balance will fall far in 2020 -- from negative investment returns and from extraordinary withdrawals to cope with the pandemic -- and there may not be any more petroleum revenues to replenish it. How will Timor-Leste finance its government after things return to “normal”?

Update, 1 June 2020

During May, the U.S. stock market continued to improve, in spite of major problems in the U.S. and global economies. Oil prices also recovered a little, although they remain about half of what they were at the start of the year. Interest rates on U.S. Treasury Bonds dropped slightly during the month. As the economic impacts of the pandemic are far from over, analysts worry that the rebound might not continue.