Dili, 22nd December 2016, the Government of Timor-Leste through Ministry of Finance (MoF) has signed an agreement with Asian Development Bank (ADB) on loan to fund National Road construction from Manatuto to Baucau in Knowledge Centre, Ministry of Finance Office.
The agreement was signed by Ministry of Finance, Mrs. Santina J. R. F. Viegas Cardoso and Designated Officer in Charge ADB Resident Mission in Timor-Leste, Mr. Richard Phelps and participated by Vice Minister of Finance, Mr. Helder Lopes, Minister of Public Works, Transportation and Telecommunication, Mr. Gastão de Sousa, Chief Representative of JICA, Mr. Hikoyuki Ukai and staff from Ministry of Finance, ADB and JICA.
The Vice Minister of Finance, Mr. Helder Lopes says, “the total loans from ADB is 49, 6 millions and the total value of the project is 59 millions so the Government of Timor-Leste will add some amount to complete the total value of the project”.
“The road construction of Manatuto to Baucau is a priority of Timor-Leste’s government to complete the road from board, Batugede to Com named Northern Corridor”, he adds.
The Vice Minister explains that, when we do the loan, there is perception that we are creating a debt to next generation. I need to explain that, the signing of this agreement with the purpose of the loan money is cheap in the sense that we took money from the petroleum fund, we will lose the interest earned from petroleum investment in comparison with the interest or the money that we will pay the loan, therefore the government thinks to do loan in order to fund the project.
Total loans already signed by the government so far is 370 millions, is still very small compared to the Gross Domestic Product. The government conducted an analysis which when we make loan with the thought that the loan could be paid back with revenues of economic activity. Therefore, we look at the ratio of loans and the level of sustainability then we can pay it back, and when the government do loan always see the existing capabilities that government has.
The task of Ministry of Finance is to find the money to fund the implementation of the project and on the implementation of the project will be carried out by Ministry of Public Works, Transportation and Communication (MOPTC) in accordance with the work plan that has been signed.