LDC Graduation : The Council of Ministers has designated the Ministry of Foreign Affairs and Cooperation to lead Timor-Leste’s graduation process from the category of LDC. However, the Ministry is fully cognizant that it is unable to deliver on its own and has to coordinate with key technical Ministries such as the Ministry of Finance, the Ministry of Petroleum and Mineral Resources, the Ministry of Agriculture and Fisheries, the Secretary of State for Environment, and the Ministry of Tourism, Commerce and Industry.
In 2022, Timor-Leste will have to start working on the review of the preparation for graduation, including the elaboration of the Graduation Smooth Transition Strategy. In order to develop the document, the Ministry has to reactivate the working group involving the Ministries mentioned and collaborate with the UNDP, UN RCO, and UN-ESCAP Office that have expressed their readiness to support Timor-Leste on this matter.
Decision on Deferral of LDC Graduation
Timor-Leste was eligible to be recommended by the Committee for Development and Policy (CDP) for graduation during the triennial review of the CDP in February 2021. Having consulted with various Government agencies, it was concluded that Timor-Leste is not yet ready to graduate from the category of the LDC given the concerns over Timor-Leste’s economic vulnerability arising from its high dependency on the oil and gas industry, which raise concerns over the sustainability of its graduation.
Therefore, MNEC submitted a proposal to the Council of Ministers to request and lobby for the deferral of Timor-Leste’s graduation from the category of LDC. On 13 January 2021, the Council of Ministers approved the proposal, and MNEC undertook to lobby the members of the CDP and ECOSOC members for the CDP not to recommend Timor-Leste’s graduation from the category of LDC.
The joint efforts of MNEC and competent line Ministries were successful as the CDP eventually did not recommend graduation. Hence, Timor-Leste’s graduation will be reviewed again in 2024.