What is the EBA?
The “Everything but Arms”(EBA) scheme is a permanent arrangement covering Least Developed Countries (LDC’s) as classified by the United Nations. This arrangement enables duty-free and quota-free access for all products (7200 products in total) originating in LDC’s except for arms and ammunition. Different from the Standard GSP and GSP+, LDC’s are not excluded from the scheme if they benefit from other preferential arrangements.
1,34 M
Population
Semi-Presidential Republic
Government
-20.50%
GDP Growth
2.50%
Inflation
$ 3,20 B
GDP
Facts about Timor-Leste's economy
Island Economy
Timor Leste is an island economy in southeast Asia and shares a border with Indonesia. The terrain is mainly mountainous with some plateaus in the northern part of the island. Given its geographic location, the country is vulnerable to earthquakes and tsunamis.
Export Products
Timor-Leste's main export articles are mineral fuels like petroleum oils, propane and butanes, coffee, vanilla and vegetable products as well as ferrous waste and scrap mainly from aluminium and steel.
Trade Partners
Timor-Leste's most important trading partners are Indonesia, Switzerland, and Malaysia, which together account for more than 55% of overall trade. Singapore and Indonesia are by far the most important export markets, while most imports originate from Indonesia and Switzerland.
Economic Structure
Offshore oil and gas resources are an important pillar of the economy and government revenues. Oil rents contribute around 33% to the country's GDP. The great majority of the population is employed in the agricultural and services sector. Important agricultural products include corn, rice, cassava, sweet potatoes, coconuts, and coffee. The manufacturing sector focusses on textiles and garments, handicrafts, and the processing of coffee. Furthermore, marble quarrying builds another source for foreign exchange.
Usage of EBA Preferences
About 6% of imports from Timor Leste are eligible for EBA preferences. However, the country did not make use of its preferential access to the EU market in 2020.
Trade with the EU
Total trade with the EU amounted to € 15 million in 2020. With a share of 1.3% of total trade, the EU only plays a subordinate role in Timor-Leste's trade relations.
Timor-Leste and the EU (2022)
Imports from Timor-Leste by product section
Imports from Timor-Leste over time (in € m)
TIMOR-LESTE AND THE EU’s GSP
Economic Impact
2%
Only a small share of Timor-Leste's exports to the European market are eligible for preferences granted by the EU's EBA scheme.
0%
Timor-Leste currently does not make use of preferences granted under the EU's EBA.
Preference utilisation and export diversification
Timor-Leste's imports to the EU
Preference Utilisation vs. total eligible imports
The largest product sections under EBA
SUSTAINABLE DEVELOPMENT
As a beneficiary of the EBA, Timor-Leste is not obligated to ratify any conventions to be able to benefit from preferential access to the European market. Nonetheless, Timor-Leste has ratified 6 out of 7 UN conventions on the protection of human rights and 6 out of 8 fundamental ILO labour rights conventions. Additionally, Timor-Leste has ratified 4 environmental protection conventions as well as 2 conventions on good governance.
Core international conventions on human rights and labour standards
Ratified
- International Convention on the Elimination of All Forms of Racial Discrimination (1969)
- International Covenant on Civil and Political Rights (1976)
- International Covenant on Economic Social and Cultural Rights (1976)
- Convention on the Elimination of All Forms of Discrimination Against Women (1981)
- Convention Against Torture and other Cruel, Inhuman or Degrading Treatment or Punishment (1987)
- Convention on the Rights of the Child (1990)
- Convention concerning Forced or Compulsory Labour, No 29 (1930)
- Convention concerning Freedom of Association and Protection of the Right to Organise, No 87 (1948)
- Convention concerning the Application of the Principles of the Right to Organise and to Bargain Collectively, No 98 (1949)
- Convention concerning Equal Remuneration of Men and Women Workers for Work of Equal Value, No 100 (1951)
- Convention concerning Discrimination in Respect of Employment and Occupation, No 111 (1958)
- Convention concerning the Prohibition and Immediate Action for the Elimination of the Worst Forms of Child Labour, No 182 (1999)
Not Ratified
- Convention on the Prevention and Punishment of the Crime of Genocide (1948)
- Convention concerning the Abolition of Forced Labour, No 105 (1957)
- Convention concerning Minimum Age for Admission to Employment, No 138 (1973)
Additional Conventions
- Montreal Protocol on Substances that Deplete the Ozone Layer (1987)
- Convention on Biological Diversity (1992)
- The United Nations Framework Convention on Climate Change (1992)
- United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988)
- United Nations Convention against Corruption (2004)
EU-Timor-Leste Bilateral Development Assistance
€ 95 million
EU-Timor Leste cooperation during the period of 2014-2020 had a budget of about €95 million and focusses on three priority areas. These included good governance, rural development, and other support measures. Funds were allocated inter alia to support the reform of public institutions and the public finance management, to increase productivity in the agricultural sector, to improve rural infrastructure and combat malnutrition and food insecurity. Timor Leste additionally benefits from funds provided by the EU Regional Programme for the Pacific, which in total amount to about €166 million.
Opportunities in Timor-Leste
- Timor-Leste is currently investing in improving its infrastructure, including for example two additional power plant units, the upgrade of the international airports as well as some regional airports, extension and upgrading of its road infrastructure and in improving water quality and sanitation.
- Furthermore, the Tasi Mane project will implement an industrial zone (800 hectares) supporting the development of the petrol industry.
Most recent events
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