Limping on three legs: The development problem of Timor-Leste
Country Economic Report
Mats Lundahl , Fredrik Sjöholm
This country economic report on Timor-Leste is part of a series of studies, undertaken by various Swedish niversities and academic research institutes in collaboration with Sida. The main purpose of these studies is to enhance our knowledge and understanding of current economic development processes and challenges in Sweden's main artner countries for development co-operation. It is also hoped that they will have a broader academic interest and that the collaboration will serve to strengthen the Swedish academic resource base in the field of development economics. The present study is the third in a sequence of studies by the same authors, funded by Sida and published in the Sida Series Country Economic Report. The two earlier studies are Mats Lundahl and Fredrik Sjöholm, Poverty and Development in Timor Leste, Country Economic Report 2005:3 (Stockholm: Sida) and Mats Lundahl and Fredrik Sjöholm, Economic Development in Timor Leste 2000-2005, Country Economic Report 2006:4 (Stockholm: Sida). The two earlier studies dealt with the promises and problems offered by the oil sector, respectively the potential for agricultural development. The present study focuses in particular on the creation of a modern private sector. It also explores the economic mechanisms governing the behaviour of rural farm households, in view of the inability, so far, to develop a viable alternative to agriculture.