East Timor (Timor Leste) - Telecoms, Mobile and Internet

Timor Leste (formerly known as East Timor) has been working to build up its economy. The effort to build its telecommunications infrastructure has been part of a wider push on the economic front. The prevailing social and political environment, however, continues to present major challenges to those who are seeking to improve the country.

Political instability and outbreaks of civil unrest that erupted in Timor Leste in April/May 2006 continued into the first half of 2007. Despite the election of a new government led by Nobel Peace Laureate Jose Ramos-Horta in May/June 2007, opposition to the administration caused further outbreaks of violence and looting.

To the outside observer, the country appeared to have started reasonably well in rebuilding its entire infrastructure following the turbulence that ensued after the referendum of 1999. However, the events of 2006/07 caused major concerns about the direction of the Timor Leste; it remained difficult to assess the long term impact of these events on the country's fragile economy and the process of infrastructure building.

Then, in February 2008 President Ramos-Horta was shot and severely wounded in an attack led by rebel Alfredo Reinado (who was allegedly involved in the unrest of April/May 2006). A short time later a convoy including Prime Minister Gusmao was fired upon. The Prime Minister was uninjured. Responding to the attacks, the government declared a state of emergency. President Ramos-Horta returned in April 2008, after receiving medical treatment in Australia. The state of emergency ended in May 2008, following the surrender of most of the rebels.

In the meantime, throughout this difficult political period, the country's mobile sector was experiencing strong growth (over 50% in 2006; just on 50% in 2007, 66% in 2008), with mobile penetration reaching a low, but nonetheless significant, 13% milestone by early 2009. Fixed-line network expansion was still languishing coming into 2009, with teledensity down around 0.2%. Although it was difficult to get accurate figures on the Internet market, the evidence suggested that growth in this sector remained constricted and there was little optimism about online activity in the short term.

It is noted that Timor Leste has finally been listed as a member of the ITU. While the ITU does provide some information on this market, it has continued to be a difficult task to obtain official statistics for the country's telecom sector. Where official statistics are not available, BuddeComm normally provides an estimate.

Key highlights:

• The year 2008 delivered another hugely positive result for Timor Leste's mobile market, with growth surging by 66% for the year;
• Mobile subscriber numbers had reached 140,000 and penetration was almost 13% by March 2009.
• On the broader front, however, the ongoing political and civil unrest the country had been experiencing in 2008, continued to cast a cloud over the nation's development coming into 2009;
• It was proving a major distraction for government, putting a serious damper on development programs and infrastructure building.

This report provides an overview of the trends and developments in the telecommunications markets in Timor Leste. Subjects covered include:

• Key Statistics;
• Market and Industry Overviews;
• Regulatory Environment;
• Infrastructure;
• Mobile Market;
• Internet Market.