• Historical background

• Scorecards for FY 2012, 2013, 2014, 2015-2016, 2017, 2018, 2019, 2020, 2021, 2022, 2023 and 2024

• The May 2010 Threshold Agreement

• Programming against corruption

• Designing and signing a new Compact in 2018-2022

• Compact implementation

• Documents and links

• Istoria dahuluk

• Scorecard ba tinan 2012, 2013, 2014, 2015-2016, 2017, 2018, 2019, 2020, 2021, 2022  2023 no 2024

• Akordu “Tama Fatin” Maio 2010 nian

• Programa kontra korrupsaun

• Dezenhu no asina kompaktu foun iha 2018-2022

• Implementasaun ba kompaktu

• Documentu no ligasaun sira (Ligasaun barak iha textu tuir mai iha lian Ingles, laiha versaun Tetum.)

In May 2010, the government of Timor-Leste signed an agreement with the Millennium Challenge Corporation (MCC), a U.S. government agency, for a $10.5 million, three-year "Threshold Grant" to improve childhood immunization and combat corruption in Timor-Leste. This web page contains historical background, as well as information about that agreement, the anti-corruption program and links to relevant documents. Another page describes jobs offered for MCC-funded anti-corruption work in Timor-Leste.

Iha Maio 2010, Governu Timor-Leste asina akordo ida ho Millennium Challenge Corporation (MCC), ajensia Estadus Unidus da America (EUA) nian ida, ba tokon $10.5, “Tama Fatin” – katak Timor-Leste seidauk elijibel kompletamente atu simu osan hosi MCC – ba tinan tolu nian atu hadi’a imunizasaun ba labarik no atu kombate korupsaun iha Timor-Leste. Pagina ida ne’e komposto hosi informasaun istoriku, no mos informasaun kona ba akordo ne’e, programa kontra korupsaun no ligasaun ho dokumentu relevante sira. Pajina ida seluk descreve kona ba servisu ne’ebe agora dadaun ofrese hela ba iha programa kontra korupsaun iha Timor-Leste, ne’ebe hetan fundus hosi MCC.

A few years ago, Timor-Leste hoped to get more than $300 million in U.S. assistance to construct local infrastructure under the MCC program. Eligibility for such MCC funding depends on some annual indicator scores which MCC uses to decide which countries qualify for that level of assistance. The MCC announces its annual scorecard near the end of the previous year, based on indicators calculated by other organizations, as listed in the table below. Scores are compared with other countries in the same income category, and MCC only supports countries when most of their scores are better than the average (median) for countries in their category.

After being selected for intermediate "threshold" status in 2004, Timor-Leste first qualified for full MCC funding in early 2006, but the process of negotiating an agreement (called a "compact") between Dili and Washington was never completed, due to the "crisis" and the change of government in Dili. For background and context, see Timor-Leste Seeks Millennium Challenge Funding from Washington written for ETAN in October 2008.

MCC tabulates new scores every October, which are labeled with the follow year's number because the U.S. Fiscal year (FY) starts in October of the previous calendar year. When FY2008 figures were announced at the end of 2007, Timor-Leste's indicators (particularly the one on controlling corruption) had fallen below the levels MCC requires for compact eligibility. However, U.S. Ambassador Hans Klemm and the Timor-Leste Government were able to persuade the MCC to bend the rules, and Timor-Leste remained eligible for another year, although compact negotiations were not completed. As scores dropped further for fiscal 2009, the Ministry of Finance tried to persuade MCC that they were serious about controlling corruption (see MoF 2008 Annual Report), but the MCC board ruled that Timor-Leste was no longer compact-eligible. [Reference: Fact sheet on MCC decision-making process.] At the end of 2008, Timor-Leste lost its eligibility for a compact but was accepted for "Threshold" status which provides a smaller level of funding to help the country improve its scores.

Timor-Leste was considered a Low-Income Country (LIC). However, due to the inflow of oil money which raised our per capita income above $1,855, Timor-Leste moved into the Lower Middle Income Country (LMIC) status in 2010. Comparing Timor-Leste with less poor countries made its percentages lower, and caused Timor-Leste to fall below the median passing score for Girls Primary Education Completion, making it more difficult to qualify for compact eligibility.

The 2010 scores were tabulated by MCC in October 2009 based on indicators calculated by other agencies during the previous 12 months. MCC published a Guide to the Indicators and Data Notes to explain the indicators they use and how they are compared with other countries.

In October 2010, MCC published scores for 2011. Timor-Leste did worse on 11 criteria compared with the previous year, and improved in 4, with two unchanged. As described by the Center for Global Development, Timor-Leste fell 11 percentage points in the key corruption indicator. Timor-Leste's score is worse than 28 other LMIC countries, and only better than Angola, Iraq and Afghanistan.

Scores for Fiscal Year 2012

In November 2011, MCC published its scores for Fiscal Year 2012. Because they changed their methodology and some of the indicators, there are two score sheets. The old style one can be compared with past years, and the new one will be useful in the future. 

It is difficult to compare scores across years because MCC sent Timor-Leste back in to the Low-Income Country (LIC) category for 2012 (it was a Low-Middle Income Country - LMIC - in 2010-2011), due to an erroneous income (GNI) figure they got from the World Bank. To compensate for this, La'o Hamutuk calculated Timor-Leste's MCC scores as if it had been scored as a LMIC country, which allows comparison with other years, and we published the revised scorecard at right with both the LIC and LMIC scores. (Click on each graphic to see it larger.) Graphs on this revised scorecard are the LIC scores.

As the scorecard shows, Timor-Leste as a Low-Income Country failed the indicators for Control of Corruption, Government Effectiveness, Rule of Law, Immunization Rates, Girls Primary Education Completion, Regulatory Quality and Business Startup. In addition, lack of data prevented us from passing Primary Education Expenditures and Land Rights and Access.

When scored as an LMIC country, we also fail Civil Liberties, Natural Resource Management, and Trade Policy.  Timor-Leste's FY 2012 scores declined slightly since last year on indicators that it passed, and increased slightly where it was doing poorly (except immunization rates, which continue to fall). Civil Liberties is the only score which TL passed in FY2011 but failed in FY2012.

Click here for a 60-page Guide to MCC's FY2012 indicators, and for the World Bank Institute's Worldwide Governance Indicators 2002-2010 report for Timor-Leste, which shows sources and history for five indicators used by MCC.

Scores for Fiscal Year 2013

The Fiscal Year 2013 scores, released on 7 November 2012, reflect information about the situation in Timor-Leste during 2011. Unlike last year, MCC correctly categorized Timor-Leste as a Low-Middle Income Country (LMIC).

The graph at right shows how Timor-Leste's scores have changed over the past four MCC scorecards, using score values as selected and updated by MCC. We continued to score well on Fiscal Policy because we had not yet taken on external debt. The high Health Expenditure score is a statistical error (MCC uses a WHO indicator of health expenditure as a percent of GDP, and Timor-Leste's GDP does not include our oil revenues, producing an inappropriately high score).

Timor-Leste improved on Business Start-up (because it takes less time to get a business license), and moved up slightly on Freedom of Information (because other countries got worse). MCC changed how they decide if Civil Liberties is passing, so we moved from fail to pass even though our score did not change.

Unfortunately, Timor-Leste's scores worsened on every other measure, although none moved from "pass" to "fail." We now barely pass Natural Resource Protection and Political Rights. Our 13.5% inflation rate is higher than all other LMICs, although not quite failing (defined as above 15%).

The make-or-break Control of Corruption indicator continues to fall. Timor-Leste now scores lower than all but two of the 33 LMICs (Iraq and Republic of Congo).

A few weeks after the MCC 2013 scores were published in late 2012, Transparency International released their annual Corruption Perception Index. Timor-Leste's ranking improved by 30 places -- a different conclusion than the MCC corruption score, which is getting worse. La'o Hamutuk researched and explained the inconsistency in a blog posting.

Tinan hirak liu ba, Timor-Leste espera atu hetan osan tokon $300 resin hanesan asistensia EUA nian atu konstrui infrastrutura lokal iha programa MCC nia okos. Elijibilidade ba fundus MCC nian ida ne’e depende ba rezultadu indikador annual balu, ne’ebe MCC usa atu desidi nasaun ida ne’ebe mak qualifika ba nivel assistensia ida ne’ebe. MCC anunsia ninia rezultadu kada tinan wainhira tinan ida antes besik remata, baseia ba indikador sira ne’ebe kalkula hosi organizasaun seluk, hanesan lista iha tabela iha okos. Rezultadu sira ne’e kompara ho nasaun seluk iha kategoria rendimentu hanesan, no MCC supporta deit nasaun sira wainhira rezultadu barak diak liu kompara ho median ba nasaun sira ne’ebe tama sira nia kategoria.

Depois hetan seleksaun ho status hanesan “Tama Fatin” intermediariu iha 2004, Timor-Leste, ba dala uluk hetan qualifikasaun atu hetan fundus masimu iha inisiu 2006, maibe Dili no Washington nunka kompleta prosesu negosiasaun ba akordo ida (hanaran "kompaktu") tanba “krize” no mos mudansa governu iha Dili. Atu hetan informasaun dahuluk no kontextu, hare Timor-Leste buka Fundu Millennium Challenge hosi Washington, hakerek ba ETAN iha Outubru 2008.

MCC tabula rezultadu foun kada Outubru  no labela ho numeru tinan tuir fali tanba tinan Fiskal EUA nian komesa iha Outubru hosi tinan kalendariu antes. Wainhira figura tinan fiskal 2008 anunsia iha tinan 2007 nia rohan, indikador Timor-Leste nian (partikularment ida ne’ebe kona ba kontrola korupsaun monu tia ona iha nivel requirementu MCC nia okos atu ba hetan elijibilidade ba kompaktu. Maibe, Ambassador EUA nian iha Timor-Leste, Hans Klemm, konsege persua MCC atu hakle’uk regulamentu, no Timor-Leste kontiua iha elijibilidade ba tinan ida tan, maski  negosiasaun kompaktu seidauk kompleta. Hanesan rezultadu monu liu tan ba tinan fiskal 2009 nian, Ministeriu Finansas tenta atu persua MCC katak sira serio kona ba kontrola korupsaun (hare Relatorio Annual 2008 Ministeriu Finansas nian), maibe Board MCC nian decidi katak Timor lai sai tan hanesan nasaun ne’ebe iha eligibilidade ba kompaktu. (Referensia: Faktus kona ba prosesu halo decisaun MCC nian). Iha tinan 2008 nia rohan Timor-Leste lakon ninia eligibilidade ba kompaktu ida, maibe simu hanesan status “Tama Fatin” hodi hetan fundus ki’ik oan liu atu ajuda nasaun ne’e lori hadi’a ninia valor.

Uluk,Timor-Leste konsidera hanesan Nasaun ho Rendimentu Okos. Maibe tanba hetan rendimentu hosi osan mina, ne’ebe aumenta rendimentu per capita liu $1,855, Timor-Leste muda ba status nudar nasaun ho rendmentu Medio Kraik liu iha tinan 2010. Kompara Timor-Leste ho nasaun sira ne’ebe la dun kiak, halo Timor-Leste nia persentagem tun liu, no kausa Timor-Leste tun liu ba median nia okos, liu valor ba Remata Edukasaun Primaria ba Labarik Feto Sira, diffikulta liu tan Timor-Leste atu hetan kualifikasaun ba elijibilidade kompaktu nian.

Rezultadu 2010 nian ne’ebe tabula hosi MCC iha Outubro 2010 baseia ba indikador sira ne’ebe kalkula hosi ajensia sira seluk durante fulan 12 antes. MCC publika Mata dalan ida ba Indikador sira no Nota Data sira atu esplika indikador sira ne’ebe sira usa no oinsa sira kompara ho nasaun sira seluk.

Iha tabela kraik ne’e koor verde fo indikasaun wainhira Timor-Leste liu valor, kinur wainhira regulamentu hakle’uk, no mean fo indikasaun wainhira Timor-Leste la pasa.

Atu hetan elijibilidade ba kompaktu tan, Timor-Leste presiza atu passa kontrola korupsaun and minimu aumenta tan indikador rua ba kategoria "Investe ba humanu" no ida tan iha kategoria "Liberdade Ekonomia.” Aumenta tan, Timor-Leste tenki mantein ninia grau ba pasa nian iha indikador sira hotu ne’ebe marka ho verde iha 2014.

Scores for Fiscal Year 2014

MCC published the scores for FY 2014 in November 2013. Timor-Leste passed exactly the same indicators as the previous year, although some scores have shifted slightly. We improved on nine indicators, dropped on six, and were unchanged on three. Timor-Leste remains a Low-Middle Income Country and is still far from qualifying for MCC Compact Funding, although the Threshold program here is in its final year.

In the table below, green indicates when Timor-Leste passed a score and red indicates when Timor-Leste did not pass. . MCC added some new scores in FY2013 and dropped some old ones, as well as modifying the rules to determine Compact eligibility.

To become eligible for a compact again as a LMIC, Timor-Leste needs to pass Control of Corruption and at least two additional indicators in both the "Investing in People" and "Economic Freedom" categories. In addition, the country must maintain passing grades in all indicators which were green in Fiscal Year 2014.

MCC published the scores for FY 2015 in November 2014. Timor-Leste improved on several indicators, and passed two (Business Start-Up and Trade Policy) which it had failed in prior years. Nevertheless, Timor-Leste passed only nine of the 20 indicators, and failed the required Control of Corruption one, and is therefore still ineligible to sign a Compact for long-term funding from the Millennium Challenge Corporation. Because the three-year MCC Threshold Program ended in March 2014, MCC is no longer active in Timor-Leste. However, they continue to publish scorecards for this country.

FY 2016 scores were published in November 2015. Timor-Leste failed two indicators that it had passed the previous year: Natural Resource Protection (because other Low-Middle Income Countries improved more than Timor-Leste did) and Health Expenditure (because previous MCC reports had used non-oil GDP, rather than total GDP, as a denominator). However, we scored well on Gender in the Economy, which measures discrimination against women in legal systems, as it had data for Timor-Leste for the first time.

Click on the graph at right to see it larger. [Because of the change of category for Fiscal Year 2017, the graph does not include the most recent scores.]

MCC bases its eligibility criteria on how a given country compares with others in the same economic category. Since 2010, MCC has categorized Timor-Leste as a Low-Middle Income Country (LMIC), but in the Fiscal Year 2017 scorecard (mostly based on data from 2015), the country's GNI per capita fell from $3,120 to $1,920 due to declining oil prices and production. As a result, MCC recategorized Timor-Leste as a Low Income Country (LIC), comparing it with other poor countries who do less well on the indicators. TL's rankings within the poorer category are significantly better than they were as a LMIC, and the country passed more indicators, including the essential one on Corruption. Although TL's actual scores on the indicators, including the four which it passed for the first time (see table below), haven't changed much over the last year or two, MCC sees the country as more deserving of support.

Because of the improved scores, the MCC Board approved a new Threshold Program for Timor-Leste on 16 December 2016. They wrote that "Timor-Leste offers MCC the opportunity to support the government with its significant policy and institutional reform needs as it confronts substantial poverty and capacity challenges, especially in the face of a difficult macroeconomic environment. While it has historically struggled to pass the MCC scorecard as an LMIC, Timor-Leste has fallen into the LIC category, where it does pass MCC's scorecard with 12 out of 20 indicators met, including both democratic rights indicators and the Control of Corruption indicator."

At a Town Hall following the Board meeting, MCC described the Threshold program as "smaller and focused on policy and institutional reform. It's really for countries that are close to passing or only just starting to pass, where we are hopeful that in the medium to long term they are likely to continue to pass the scorecard and thus be a likely Compact contender in the future. This year we only selected Kosovo and Timor-Leste. Timor-Leste has had, historically, a large oil base, but with the commodity crash it's fallen back into the low-income pool and this is the first time we've seen it start to pass its scorecard as a Low-Income Country. When you dig deep into what Timor's story is all about, they have most needs in the policy and institutional reform space, which is exactly what our Threshold program is set up to do."

In early 2017, MCC prepared a 'Constraints Analysis' to inform the design of the Timor-Leste Threshold program, and MCC staffers visited several times during the year.

Scores stabilize in Fiscal Years 2018-2023

MCC issued its Fiscal Year 2018 scorecard in November 2017, showing improved scores in Natural Resource Protection and other areas.

On 19 December 2017, the MCC Board of Directors decided that Timor-Leste is eligible for a new Compact program, and specifics are being worked out with the government during 2018 and 2019.  See below for the evolution of this process.

MCC issued its scorecard for Fiscal Year 2019 in November 2018, showing significant improvements in Health Expenditure and Regulatory Quality, and a much worse score in Fiscal Policy. Some of the data appears to differ from the actual situation.

In the table below, green indicates when Timor-Leste passed a score and red indicates when Timor-Leste did not pass. The magenta years 2010-2016 compare Timor-Leste with other Low-Middle Income Countries. In 2017, Timor-Leste dropped back onto the Low Income Country category, so it did better when compared with a poorer group, even though there was little change in its actual indicators. For most scores, passing requires that a country score higher than the median -- that is, better than half of the other countries in the same economic category.

MCC issued its scorecard for Fiscal Year 2020 in November 2019, which is almost the same as the previous year's. 

In the FY 2021 scorecard issued at the end of 2020, Timor-Leste improved slightly, although some indicators dropped a little.

In the FY 2022 scorecard issued in November 2021, Timor-Leste again improved slightly, although some indicators dropped a little.

In the FY 2023 scorecard issued in November 2022, Timor-Leste gained on some and fell on others, partly because MCC replaced the "Business Start-Up" indicator with "Employment Opportunity".

In the FY 2024 scorecard issued in November 2023, Timor-Leste gained on some and fell on others.
 

The May 2010 Threshold Agreement

After several months of negotiation, the Governments of Timor-Leste and the USA (through the Millennium Challenge Corporation) agreed on a "threshold program" designed to improve Timor-Leste's scores on the Control of Corruption and Immunization Rates indicators. This program is managed by USAID, and was announced by the RDTL Ministry of Foreign Affairs, Council of Ministers and the MCC. As required by U.S. law, MCC notified the U.S. Congress with a description of the program.

The program totals $10,496,000 over three years. Anti-corruption will get $7.1 million, immunization $2.6 million, and the remaining $0.8 million was added by MCC for Monitoring and Evaluation of the anti-corruption program.

Timor-Leste and the USA signed a formal agreement to carry out this program on 22 September 2010.

Akordu “Tama Fatin” Maio 2010 nian

Liu tiha negosiasaun durante fulan hirak nia laran, Governu Timor-Leste no EUA (liu hosi Millennium Challenge Corporation) konkorda kona ba programa “Tama Fatin” ida ne’ebe dezeino atu hadi’a rezultadu Timor-Leste nian iha indkador kontrola korupsaun sira no imunizasaun. Programa ida ne’e maka maneja hosi USAID, no anunsia hosi Ministeriu Negosiu Estrangeiru RDTL nian, Konselho Ministro no MCC. Hanesan rekerementu hosi lei EUA nian, MCC notifika Kongresu EUA nian ho deskripsaun kona ba programa.

Programa ho osan hamutuk $ 10,496,000 ba tinan tolu. Kontra korupsaun sei hetan tokon $7.1, immunizasaun tokon $2.6 and restu tokon $0.8 sei aumenta hosi MCC ba programa Monitorizasaun no Evaluasaun kontra korupsaun.

Governu Timor-Leste no Estadus Unidus asina akordo (Ingles) atu ezekuta programa ida ne'e iha loron 22 fulan Setembru 2010.

In September 2009, USAID released a "Corruption Assessment for Timor-Leste, which informed the design of the MCC anti-corruption program. It provides country-specific information to supplement MCC's global 2007 Working Paper on MCC's Role in the Fight Against Corruption "Building Public Integrity through Positive Incentives".

Information about the upcoming MCC anti-corruption program in Timor-Leste began circulating in Washington circles in 2009, and several "beltway bandit" companies sent people to Timor-Leste to assess their opportunity for getting the contract. Under USAID procedures, there was no open announcement of an upcoming public tender. Instead, USAID invited six pre-selected companies -- ARD (a division of Tetra Tech), Casals & Associates (recently taken over by DynCorp International), Chemonics, DAI,  Management Systems International (MSI, part of Coffey International Development), and the QED Group -- to participate.

USAID lists qualified bidders, including their contact information, on web pages for Democracy and Governance (scroll down to "Encouraging Global Anticorruption and Good Governance Efforts (ENGAGE)") and Evaluation Services projects. The six companies qualified for ENGAGE contracts "Provide a wide array of support services encompassing short- and long-term technical assistance and other support in innovative anticorruption, transparency, integrity and accountability program areas."  The evaluators -- AMEX International, Development & Training Services, International Business & Technical Consultants, Mendez England & Associates and Social Impact -- "Provide technical and advisory services for evaluations activities worldwide, at the mission (operating unit), bureau, and Agency-wide levels."

Even before USAID defined the program and invited proposals, these companies began recruiting in Timor-Leste for key staffers. Although only one of the six companies will get the contract, it is so lucrative that each of them spent tens of thousands of dollars flying to Timor-Leste to prepare their bids, although QED Group withdrew from the competition.

On 8 June 2010, USAID issued a 13-page Request for Task Order Proposal (RFTOP) which describes the anti-corruption project's objectives and structure and asks for bids to be submitted to USAID's Bangkok office by 16 July. The RFTOP's three pages of "Background" does not mention anything that occurred before 2006, and we hope that project implementers will have a better understanding of the history and context of Timor-Leste. USAID put out another RFTOP for Monitoring and Evaluation of the Timor-Leste MCC Threshold Program for Anti-Corruption.  USAID awarded the Anti-corruption contract to Casals in February 2011 and the Monitoring and Evaluation contract to Social Impact (see job ad) a few weeks later.

The three-year anti-corruption project "seeks to reduce corruption in Timor Leste by strengthening institutions and organizations with mandates to promote government transparency and accountability, and by fostering integration and collaboration among these institutions/organizations." It has many components, some of which will be difficult to implement or evaluate:

1. Anti-Corruption Commission (capacity building and developing linkages with other oversight institutions)

2. Office of the Prosecutor General (enhance investigative and prosecution-related skills)

3. External Audit Authority (assist in the creation of the High Administrative, Tax and Audit Court; upgrade audit skills for the Inspector General)

4. Procurement Policies and Practices (improve policies, regulations and practices)

5. Fiscal Oversight Skills of the National Parliament (strengthen parliament’s role as a check on corruption and collusion)

6. External Watchdog and Public Advocacy Efforts (enhance the capacity of non-state actors, including civil society organizations, media, academia, and the private sector)

Two high-level officials from MCC in Washington visited Timor-Leste in January 2011 to "highlight" the September 2010 Threshold Program Assistance Agreement between Timor-Leste and the USA.

In February 2011, USAID issued the contract to Casals and Associates, which had been bought by the U.S. military contractor DynCorp International in January 2010. DynCorp deployed police and military to Timor-Leste a decade ago, as described in this 2002 La'o Hamutuk Bulletin. In 2009, the company was exposed as having overbilled the U.S. Defense Department by $50 million for projects in Kuwait.

La'o Hamutuk has helped Casals implement some of their program, which is called FOTI-Timor-Leste. We have presented on corruption and given budget/economy trainings for journalists, civil society and advanced civil society. (See presentation index for PowerPoints.)

The FOTI-TL Anti-Corruption program in Timor-Leste ended in March 2014 (video). As Timor-Leste's Control of Corruption and other scores had not sufficiently improved to make the country eligible for an MCC Compact, the Threshold Program in Timor-Leste concluded without any follow-on MCC activity in Timor-Leste, although USAID is exploring how to continue supporting Timor-Leste's struggle against corruption.

Iha fulan Setembro 2009, USAID publika Avaliasaun Korupsaun foun ba Timor-Leste, ne’ebe informa dezenho programa kontra korupsaun MCC nian. Ida ne’e fornese informasaun specifiku nasaun nian atu suplementa Papel Servico 2007 MCC global nian kona ba papel MCC nian iha Luta Kontra Korupsaun “Hari integridade Publiku liu hosi Insentivu Positivu.”

Informasaun kona ba programa kontra korupsaun tuir mai iha Timor-Leste komesa sirkula iha linha Washington iha 2009, no kompania “beltway bandit” balu haruka ema mai Timor-Leste atu avalia sira nia opportunidade atu hetan kontratu. Tuir prosedimentu USAID nian, laiha anunsia publiku kona ba tender tuir mai. Buat nebe akontese, USAID konvida kompania nen ne’ebe hili antes – ARD (Divisaun Tetra Tech), Casals & Associates (divisaun ida hosi Internasional DynCorp), Chemonics, DAI, Manajementu Sistema Internasional (MSI, parte hosi Coffey International Development), no QED Group – atu partisipa. Maske USAID seidauk defini klaru programa ida ne'e, kompania sira hahu rekruta staff. Mas iha deit kompania ida hosi sira nain nen ne’e mak sei hetan kontratu, ida ne’e mos lukru tebes katak kada kompania ida hosi sira na’in nen ne’e gasta tia ona dollares rihun barak ne’ebe semo ba Timor-Leste atu prepara ba sira nia tender, maski Grupo QED decide ona katak sira la partisipa iha kompetisaun.

Iha loron 8 Junu 2010, USAID hasai Requesta ida ba Proposta Task Order (RFTOP) ho pagina 13, ne’ebe descreve kona ba objectivo no strutura hosi projetu kontra korupsaun no husu tender atu submete ba Edifisio USAID nian iha Bangkok antes loron 16 Julho. Informasaun dahuluk hosi pagina tolu RFTOP nian la mensiona buat ruma ne’ebe mosu antes 2006, no ami espera katak implementador hosi projetu ne’e sei iha komprendesaun diak liu hosi istoria no kontekstu Timor-Leste nian. USAID hasai RFTOP ida tan ba programa Monitorizasaun no Evaluasaun prograa kontra korupsaun.

Projetu tinan tolu ne’e “buka atu reduz korupsaun iha Timor-Leste liu hosi haforsa institusaun sira no organizasaun sira ho mandatu atu promove transparansia no akuntabilidade governu nian, no liu hosi haforsa integrasaun no kolaborasaun entre institusaun/organizasaun sira ne’e.” Ida ne’e iha komponente sira, balu hiosi ne’e sei dificil atu implementa no avalia.

1. Komisaun Anti-Korupsaun (hasa’e kapasidade no dezenvolve ligasaun ho institusaun sira seluk ne’ebe halo kontrola).

2. Edifisio Prokurador Geral (haforsa abilidade investigativo no abilidade seluk ne’ebe relata ho prosekusaun).

3. Autoridade Auditoria Externo (assisti iha kriasaun Tribunal da Contas; hasa’e capasidade audit iha Inspetor Geral)

4. Politika no Praktika Prokurament nian Sira (hadi’a politika, regulamentu no praktika sira)

5. Parlamentu Nasional nia kapasidade atu kontrola (haforsa papel parlementu nian atu supervisiona korupsaun no kolusaun)

6. Esforsa Kontrola External nian no Advokasia Publiku (Hasa’e kapasidade autor non-estadu nian sira, inklui organizasaun sosiedade sivil sira, media, akademia no seitor privado.

Designing a new Compact in 2018-2022

Because of Timor-Leste's declining oil and gas income, the country slipped into the Low Income Country category again in 2016, which improved its scores relative to other countries. The MCC Board approved a second Threshold Program for Timor-Leste that December. An MCC team visited in February 2017 to conduct a 'Constraints Analysis' to inform the design of the program, and they commissioned The Economist Intelligence Unit to analyze the environment for Public-Private Partnerships.

However, when the 2018 scorecard was released, MCC's Board of Directors in Washington decided to skip the Threshold Phase and, in December 2017, they designated Timor-Leste as eligible for a Compact -- a five-year assistance program which could involve hundreds of millions of dollars.

Many MCC staff and consultants visited Timor-Leste in 2018, meeting with government and others, including La'o Hamutuk. In April, MCC informed the U.S. Congress that it would spend $750,000 on compact development in Fiscal Year 2018, and released a summary of its Constraints Analysis, identifying limitations on private sector-led growth:

• Public Financial Management: Low sustainability and effectiveness of fiscal expenditures

• Dutch Disease: An uncompetitive real exchange rate

• Business Enabling Environment: Weak policies and institutions to enable market transactions

• Human Capital: Poor nutritional outcomes and lack of high skilled workers

In July, Timor-Leste and MCC signed an Initial Engagement Grant Agreement (press release) of cooperation, including $750,000 in initial financing to continue compact development. MCC consultants continued their research, producing papers on Evaluation of labor market supply and demand, the Business Enabling Environment root causes, Stunting and other topics.

In October, the Government invited stakeholders to the first day of a Root Cause Analysis workshop with MCC, opened by the U.S. Ambassador. On the second day, Government and MCC decided the broad outlines of the program. Minister of Legislative Reforms and Parliamentary Affairs Fidelis Magalhães began recruiting people for the government's MCC team. On 12 December, the MCC Board confirmed that Timor-Leste remains eligible for a Compact.

In February 2019, MCC told Congress that it will spend $7.38 million on Timor-Leste in the current fiscal year. Its summary of possible core objectives for compact projects include:

• Reduce the prevalence of stunting.

• Improve the skills of the Timor-Leste labor force to support private-sector led growth.

• Reduce the riskiness of business transactions by building the foundation of the commercial legal environment.

In its Congressional Budget Justification for Fiscal Year 2020 (which begins in October 2019) dated 18 March, MCC requested $250 million for Timor-Leste, nearly half of the total it requested for Compact funding worldwide for the year. They wrote "MCC expects Timor-Leste to develop concept papers for MCC consideration in FY 2019 that respond to the binding constraints highlighted above. The target date for negotiating the Timor-Leste compact is fourth quarter FY 2020."

On 25 March, Timor-Leste officially launched its Compact Development Team, headed by former Ambassador Constâncio Pinto.

On 30 April, the Council of Ministers approved a resolution on the agreement with MCC. The government and MCC signed $7.38 million grant agreement on 3 May to enable the enable the preparation of a Compact for Growth and Employment. 

In May, MCC released its Annual Report for 2018. The paragraph on Timor-Leste reads: "MCC’s Board designated Timor-Leste as eligible to develop a compact in December 2017. In FY 2018, MCC worked with the Government of Timor-Leste to understand better three binding constraints to growth, namely public financial management, low human capital driven by stunting and low education levels, and a weak business-enabling environment. MCC and the Government of Timor-Leste are exploring initiatives to address the core problems of stunting and a lack of skilled workers that underlie the human capital constraint, while recognizing the importance of improving the business environment in order for those interventions to be effective. Following this phase, MCC will work with the government to focus the scope of potential projects for further assessment."

An MCC Mission visited Timor-Leste in mid-May "to conduct due diligence on a potential project to improve commercial dispute resolution" for the upcoming Compact, and wrote an Aide-Memoire summarizing their findings.

On 10 June, GMN-TV hosted an hour-long "Grande Entervista" with RDTL MCC director Constancio Pinto and La'o Hamutuk's Febe Gomes. You can watch it on YouTube or as an 88 MB MP4 file.

In September 2019, Timor-Leste submitted two project proposals to MCC on Water, Sanitation, and Drainage Improvement (in Dili, Bobonaro and Ermera) and Skills for Employability and Productivity (focusing on secondary education). On 2 December, the governments of Timor-Leste and the USA announced that these had been accepted, and MCC's work in Timor-Leste has now entered the 'project development phase'. On 9 December, the MCC Board re-selected Timor-Leste and six other countries to develop compact programs.

In December 2020, the MCC Board reaffirmed Timor-Leste's eligibility. In January 2021, Timor-Leste's Government announced (also Tetum) that it expects to sign a five-year, $275 million agreement with MCC in June 2021. The project will focus on water and sanitation, drainage, and education infrastructure.

In February 2021, Timor-Leste's Compact Development Team (CDT) released its Annual Progress Report for 2020.

On 20 May 2021, the CDT published a Fact Sheet (also Tetum) summarizing their plans for drainage infrastructure and secondary education.

In November 2021, MCC sent a delegation from Washington to Timor-Leste, and allocated $3 million more to design and negotiate the Compact.

On 16 February 2022, Timor-Leste's Council of Ministers authorized a team led by Fidelis Magalhaes to negotiate and sign a Compact agreement with the United States.

On 15 March 2022, the MCC told the U.S. Congress about the imminent Compact, including the five-year budget at right. The largest part is the Water, Sanitation, and Drainage Project, which "aims to reduce the prevalence of fecal pathogens in piped and stored drinking water and groundwater. The proposed project includes investments in infrastructure that will introduce the country’s first central wastewater system, make related improvements to the drainage network, and build a plant to produce disinfectant chemical that will be used to treat the city water supply across the capital city of Dili and four nearby municipalities. The project will also support key policy and institutional reforms to support long-term sustainability of the infrastructure and social and behavior change efforts to improve household water management and hygiene practices."

In April 2022, Timor-Leste's Compact Development Team released its Annual Progress Report for 2021.

Also in April, Timor-Leste's team went to Washington to negotiate the final details of the five-year Compact agreement. A few months later, both MCC and the Timor-Leste government announced that the Compact would be signed soon.

On July 19, Timor-Leste and the USA signed the $420 million, 69-page Compact agreement, as announced by MCC, Timor-Leste's Government and Tatoli.  MCC informed Congress with a summary of the Compact.

Compact implementation

Timor-Leste's Parliament ratified the Compact agreement on 3 October 2022, and in November, the Council of Ministers authorized the creation of a Public Institute for the Millennium Challenge Account. The Compact Program Implementation Agreement was signed on 16 December.

In November, the Council of Ministers approved the creation of an agency Millennium Challenge Account-Timor-Leste, I.P. (MCA-TL), and its statutes were enacted in Decree-Law 96/2022 of 30 December (Port.). Two weeks later, the Prime Minister delegated the Minister of the Presidency of the Council of Ministers, Fidelis Manuel Leite Magalhães, to lead it.

Government Resolution 6/2023 of 1 March approved the Program Implementation Agreement which had been signed in December and is annexed to the resolution in English and Portuguese.

In March, the U.S. Government nominated Gigi Goodhart as the MCC Resident Country Director, with John Crippen as her Deputy.

On 14 April, the Timor-Leste Government named the members of the Executive Council of MCA-TL: Hergui Luina Fernandes Alves (President),  Rui Hernani Freitas Guterres, Maria Filomena Lay Guterres, Francisco da Silva, Esmeraldo Alves, José Monteiro and Ivete de Fátima Sarmento de Oliveira.

In June 2023, the Millennium Challenge Account began recruiting for 13 leadership positions in their 52-member Timor-Leste team. Details are at https://timorleste-jobs.tenderwell.app.

Documents and links (most recent items listed first)

From the Millennium Challenge Corporation (MCC)

• MCC scorecards for Timor-Leste for fiscal years 2004  2005  2006  2007  2008  2009  2010  2011  2012 2012 (new methodology) 2012 (LMIC)  2013  2014  2015  2016  2017  2018  2019  2020  2021  2022  2023  2024

• Congressional Notification summarizing newly signed Compact agreement (7/22)

• Compact agreement between MCC and Timor-Leste (7/22)

• Report on the Selection of Eligible Countries for Fiscal Year 2017 (12/16)

• Scorecards for all countries for Fiscal Year 2015 (6 MB) (11/14)

• Scorecards for all countries for Fiscal Year 2014 (6 MB) (11/13)

• Scorecards for all countries for Fiscal Year 2013 (6 MB) (11/12)

• Guide to the MCC indicators and the Selection Process for Fiscal Year 2013 (9/12)

• MCC web page about its programs in Timor-Leste http://www.mcc.gov/mcc/countries/timorleste/index.shtml

• Guide to the MCC indicators and the Selection Process for Fiscal Year 2012 (9/11)

• MCC and Timor-Leste: Partnering to Improve Immunization; Fight Corruption. Fact Sheet (5/10)

• Congressional Notification about MCC Threshold Program in Timor-Leste (5/10)

• The Impact of LIC to LMIC Graduation on Timor-Leste’s FY10 Scorecard (11/09)

• Fiscal Year 2010 Data Notes (11/09)

• Guide to the MCC Indicators and the Selection Process, Fiscal Year 2010 (9/09)

• Report on the Criteria and Methodology for Determining the Eligibility of Candidate Countries for MCA Assistance in FY2010 (9/09)

• MCC status reports for Timor-Leste, dated 12/06   11/07   6/08   9/08   12/08   7/09

• Timor-Leste named eligible for MCC’s threshold program (12/08)

• The Fiscal Year 2009 Selection Process for MCA Eligible Countries (8/08)

• Building Public Integrity through Positive Incentives: MCC's Role in the Fight Against Corruption. Working Paper (4/07)

• Millennium Challenge program to create thousands of jobs in Timor-Leste (11/06)

• Millennium Challenge Corporation Board Names Fiscal Year 2006 Eligible Countries (11/05)

• Millennium Challenge Corporation Names Seven Countries [including TL] Eligible for Threshold Program (9/04)

From USAID

• Threshold Program Assistance Agreement between Timor-Leste and the USA. (9/10)

• Request for Task Order Proposal for Monitoring and Evaluation of the Timor-Leste MCC Threshold Program for Anti-Corruption (6/10)

• Request for Task Order Proposal for anti-corruption project in Timor-Leste (6/10)

• Corruption Assessment: Timor-Leste (9/09)

• USAID list of companies with "Indefinite Quantity Contracts (IQCs) making them eligible to bid for anti-corruption projects. Scroll down to "Encouraging Global Anticorruption and Good Governance Efforts (ENGAGE)"

• USAID list of companies with IQCs for monitoring and evaluation projects.

From the Timor-Leste Government

• Compact Development Team Annual Progress Report for 2022 (3/23)

• Government Resolution 6/2023 approving the Compact Program Implementation Agreement, which is annexed to it (3/23)

• Decree-Law 96/2022 of 30 December (Port.) creating and setting out the statutes for Millennium Challenge Account - Timor-Leste (MCA-TL) (12/22)

• Minister Fidelis signs an agreement for the implementation of the MCC compact. Government press release (12/22)

• Program to strengthen Health Services and Institutional Integrity approved by MCC. Council of Ministers Press Release (6/10)

• MCC Approves $10.5 Million Grant for Timor-Leste to Improve Childhood Immunization and Combat Corruption. Ministry of Foreign Affairs Press Release (5/10)

• MCC page from Ministry of Finance Annual Report for 2008 (6/09)

• MCA-Timor-Leste Policy Improvement Plans from Ministry of Finance (10/08)

Other / Seluk

• Worldwide Governance Indicators report for Timor-Leste 1996-2010 from the World Bank Institute (11/11)

• Casals & Associates to Assist in Anti-Corruption Efforts in Timor Leste from DynCorp International (2/11)

• Which Countries Pass the FY2011 Corruption Indicator?  from the Center for Global Development (11/10)

• MCA Monitor from the Center for Global Development, a U.S. NGO which reports on MCC activity

• Jobs in the MCC anti-corruption project in Timor-Leste. La'o Hamutuk (6/10, updated 4/11)

• Timor-Leste Seeks Millennium Challenge Funding from Washington. Background on MCC and TL by ETAN (10/08)