East Timor - Economy

Economy

Prior to and during colonization, Timor was best known for its sandalwood.

In late 1999, much of East Timor’s civil infrastructure of was destroyed by departing Indonesian troops and anti-independence militias, and 260,000 people fled into West Timor. An international program led by the UN, manned by civilian advisers, 5,000 peacekeepers (8,000 at peak) and 1,300 police officers, substantially reconstructed the infrastructure. By mid-2002, all but about 50,000 of the refugees had returned.

The Portuguese colonial administration granted concessions to Oceanic Exploration Corporation to develop petroleum and natural gas deposits in the waters southeast of Timor. However, this was curtailed by the Indonesian invasion in 1976. The resources were divided between Indonesia and Australia with the Timor Gap Treaty in 1989. East Timor inherited no permanent maritime boundaries when it attained independence. repudiating the Timor Gap Treaty as illegal. A provisional agreement (the Timor Sea Treaty, signed when East Timor became independent on May 20, 2002) defined a Joint Petroleum Development Area (JPDA), and awarded 90% of revenues from existing projects in that area to East Timor and 10% to Australia. A 2005 agreement between the governments of East Timor and Australia mandated that both countries put aside their dispute over maritime boundaries, and that East Timor would receive 50% of the revenues from the resource exploitation in the area (estimated at A$26 billion or about US$20 billion over the lifetime of the project) from the Greater Sunrise development.

In 2007, a bad harvest led to deaths in several parts of East Timor. In November 2007, eleven subdistricts still needed food supplied by international aid.

There are no patent laws in East Timor.