Liga ba artigu ida ne'e iha Tetum
Each year, the Government of Timor-Leste prepares and submits the General State Budget (GSB) to the National Parliament, which discusses, alters if necessary and approves the budget law to guide public expenditure, intervene in the market and implement national development priorities. For the 2027 State Budget, this process is in the middle of the normal budget cycle, having done citizen consultation up to the Budget Day seminar; subsequent steps will be consolidation of sector proposals, approval by the Council of Ministers, technical revisions and submission to Parliament. At this stage, transparency and public participation, including the contribution of La'o Hamutuk, other civil society, the media and the general public, are essential to ensure that the annual budget and action plans represent the priorities and needs of the people and sustainability of the nation.The GSB is not only a financial document to set state revenues and expenditure, but is a strategic tool to facilitate and guide the development direction, in the context of structural challenges such as dependence on the Petroleum Fund, high imports, limited economic productivity, high unemployment, child malnutrition (stunting), lack of quality of education, increased territorial inequality and climate change. Therefore, discussions about the GSB should not be limited to the amount of money or the execution rate but should also pay attention to the real results that budget policy can produce for people’s lives.
The theme of the 2027 Budget Day Workshop - Strengthening Resilience through transformation: Diversify the Economy, Ensure a Sustainable Future -- shows that the government, particularly the Ministry of Finance, recognizes the need for changes in the budget preparation and implementation processes. This is most important because, for many years, budget debate has usually focused on the volume of expenditure and budget execution, rather than on the effective impact on economic productivity, people's well-being and the sustainability of public finances. Therefore, the 2027 State Budget should show a change in the paradigm of a budget that is focused only on expenditure to a results-oriented budget.
The 2027 State Budget should be an opportunity to begin structural fiscal and economic transformation in Timor-Leste. The strategic question that needs to be discussed is "Will Timor-Leste continue to rely on the Petroleum Fund to sustain current expenditure or will it channel public resources to productive investment that can create jobs, strengthen human capital, increase national production and ensure benefits for future generations?" This question concerns the future of the national economic model, fiscal sovereignty and intergenerational responsibility.
The presentation by the Ministry of Finance in the budget process, including at the Budget Day seminar, shows some progress in the areas of health, infrastructure, electrification and institutional development. However, data also confirm that the national economy has not yet been transformed into economic sovereignty. The dependence on the Petroleum Fund continues to be high, imports continue to dominate national consumption, high unemployment, malnutrition and challenges in health and education continue, and the productive capacity of the country is not yet strong. This situation shows that the 2027 State Budget should start a journey in a new direction: from dependence to building capacity, from spending to production, from consumption of imports to economic sovereignty.
Therefore, budget priorities should pay attention to productive investment, economic diversification, fiscal sustainability, human capital strengthening and effective public participation. Since June 2025, Timor-Leste no longer receives petroleum revenues because production from the only active field (Bayu-Undan) is finished. The Petroleum Fund is a national asset; it can help Timor-Leste finance development over the years, but because this resource is unrenewable, its management must be based on accountability and intergenerational justice. Petroleum wealth should be converted into productive investments that can reduce dependence on oil and benefit future generations, not unsustainable levels of current expenditure.The government and the public are worried about fiscal sustainability, which must not be resolved by cutting basic services for the people. The 2027 State Budget should prioritize efficiency in public spending, reducing non-productive expenditure and directing resources to health, education, nutrition, local production and job creation. The main objective is to use public resources responsibly and guarantee results that can benefit citizens over the long term. Therefore, the budget should be a tool not only to distribute money, but to make strategic investments to ensure the long-term needs and interests of all of our people.
Timor-Leste's economy continues to depend on imports and this increases vulnerability to global market changes caused by external shocks. Therefore, the 2027 State Budget should strengthen economic sovereignty through investing in sustainable agriculture, fisheries, livestock, forestry, cooperatives, local companies processing agricultural products. National development cannot be based solely on consumption from abroad; productive capacity must be created within the country. We must develop the capacity to produce the basic needs that our population needs for daily life.
In the areas of health and education, some progress is worth appreciating, but malnutrition and quality of learning continue to be a major challenges. Therefore, the 2027 State Budget should promote an integrated response among relevant ministries to strengthen nutrition, literacy, teacher training, clean water, sanitation and other basic services, especially outside Dili. Investment in human capital is key to ensuring inclusive and sustainable development, therefore, priority is not only to increase expenditure, but the quality of investment and lasting outcomes.
Youth is the most important strategic resource in Timor-Leste. Therefore, the 2027 State Budget should link education, technical training and productive jobs with agriculture, fisheries, tourism, digital technology and local businesses. Labor migration can benefit in the short term, but it cannot replace a national strategy to create opportunities within the country - it is necessary to invest in human capacity and develop strategic sectors to absorb human resources to build the development of the country's economy. If young people do not have skills and opportunities, the country will continue to lose the potential productive power to develop the country. Therefore, the budget should invest in capacity and competence to build a secure future.
Domestic revenue reform is also important to reduce dependence on the Petroleum Fund which will be empty in ten years, but fiscal reform must be based on social justice, transparency and protection of vulnerable people and households to ensure that fiscal pressure is no longer placed on poor people. A good tax system should expand the capacity of the state, but not increase inequality. From this point of view, revenue reform is not only viewed from the perspective of increasing revenue collection, but also for the fair distribution of accountability
Joining ASEAN and WTO and developing the blue economy should be accompanied by strengthening productive capacity, transparent governance and environmental protection. Timor-Leste should prepare itself to be a producer to replace imports and to export competitively, not just a market for imported products. This requires planning that connects the economic sector, infrastructure, education, innovation and environmental governance into an integrated strategy
In infrastructure, the priority is not only to build new projects, but to ensure the operation, maintenance, and usefulness of projects over the long term. Similarly, public debt management and public-private partnerships should be based on rigorous analysis, transparency and fiscal risk monitoring. A project that is not valuable to society cannot be considered a success, even if it is physically built. Infrastructure instruments should meet national needs and support long-term productivity. For example, contrast airports, container ports, and institutional buildings in Dili with rural roads, domestic maritime transport, and schools and health clinics in rural sucos.
The 2027 State Budget should also promote territorial justice through the allocation of resources in accordance with the needs and levels of municipal development. We appreciate the citizen consultation as well as the Government's efforts to decentralize, but need significant public participation, which will be valuable the Government publicly responds to the contribution of its citizens and integrates relevant priorities into the budget process. This process, not only administrative formality, should be a mechanism to strengthen transparency, and public consultation.
In order to prevent the capture of public resources by particular interests, the 2027 State Budget should strengthen public integrity, transparency and accountability. This requires transparent procurement, publication of contracts, independent audits, a serious environmental license process, value-for-money assessment and effective supervision by Parliament, the Court of Accounts, the Anti-Corruption Commission, the media, academics, civil society and the general public. Transparency is not an obstacle to the Government but rather a basis for strengthening public trust and ensuring that state money really serves the collective interests of the people of Timor-Leste.
Budget planning should be based on data and evidence. Data on health, education, poverty, employment and other indicators need to be current, accessible and available for public use. The Citizens’ Budget in Tetum can clearly increase fiscal literacy and promote informed public participation. Although some progress has been shown, we should continue to maintain, improve and promote all documents for Tetum. Well-informed citizens can responsibly monitor, criticize and contribute to the budget process.
The 2027 State Budget should prioritize strategic reforms, including strengthening public participation, leading to a budget with results for the people, promoting food sovereignty and local production, implementing revenue reforms and social justice, strengthening governance of public companies, transparently managing fiscal risks and ensuring sustainable investment in infrastructure and renewable energy. This priority is not only abstract but must be a real response to structural issues that keep Timor-Leste from building with justice and stability.
Therefore, the 2027 State Budget is an opportunity to change from a model that depends on the Petroleum Fund and large public spending to a model of development based on productivity, fiscal sustainability, social justice and national resilience. All of us, including leaders, should take and use this opportunity. The GSB should reflect investments in human capital, local production, environment, transparency and intergenerational justice, to ensure a sustainable future for Timor-Leste. If the 2027 State Budget guides this change, the budget rises from a mere government document to become a tool for national transformation.
We encourage readers to also read and obtain information from presentations in Tetum at official sessions on the topics discussed above:
- Presentations at the 2026 Development Partners Meeting
- Presentations at the Budget Day workshop
- Presentations at citizen consultations on the 2027 State Budget process
We are available to have discussions and improve publications whenever needed.
Thank you very much.








