European Union and Timor-Leste hold Policy Dialogue on public financial management and digital transition

The Policy Dialogue was co-chaired by Her Excellency Ms. Santina José Rodrigues F. Viegas Cardoso, Minister of Finance, and the European Union Ambassador to Timor-Leste, H.E. Thorsten Bargfrede. Participants included representatives from embassies, international agencies, civil society organizations, and senior government officials.

The PADIT–TL initiative was launched in May 2025 to reduce inequalities and strengthen public service delivery at central and local levels by modernising government processes, improving the efficiency of citizen service delivery, and promoting inclusive development through digital technologies. A total of EUR 12 million was allocated over four years: EUR 9 million as budget support to the Ministry of Finance to strengthen public financial management and digitalisation, and EUR 3 million as complementary support to develop e-government services, digital literacy, and support the development of a cohesive legislative framework for secure and trustworthy digital interactions. 
The Ministry of Finance presented the progress in the implementation of the PFM reform strategy including fiscal decentralisation. The dialogue also highlighted the role of digital transformation in strengthening PFM. Modernising and interconnecting PFM systems, including systems that better support the Tax Administration and public procurement, were identified as important areas of progress. Better interoperability between systems—including taxation, customs, public procurement, and human resources management—can improve the use of information, support transparency and accountability, and enable more timely decision-making.
As part of the dialogue, UNDP presented progress achieved under the “Dalan Digital – New Path for Digital Citizenship in Timor-Leste” project, which aims to strengthen digital public infrastructure, the legislative framework, institutional capacity, and skills development.

EUTL26

Stressing the importance of continued and transparent collaboration, EU Ambassador H.E. Thorsten Bargfrede emphasized the vital role of sustained political dialogue in advancing digitalisation efforts in Timor-Leste. He stated, “At the heart of this partnership is a simple but powerful idea: stronger public financial management and smarter digital systems can help build a more effective, transparent and accountable State.”

Minister of Finance H.E. Santina J.R.F. Viegas Cardoso emphasized the strategic alignment of with the Ministry of Finance's Five-Year Plan for 2024–2028, which sets out the Ministry’s broader strategy for public finance reform. H.E. Cardoso also highlighted ongoing efforts to modernise the PFM system, progress towards policy-based budgeting, and the importance of continued capacity building and digitalisation.
She stated: “PADIT-TL support comes at an important time. The recent inauguration of the fibre-optic cable, together with Timor-Leste’s historic accession to ASEAN in October last year, creates new opportunities for connectivity and regional engagement. But these developments also require us to strengthen our government digital services. We need to expand access, improve transparency, streamline processes, and reinforce digital security.”

Looking ahead, the European Union reaffirmed its commitment to continued political dialogue and to supporting country ownership, accountability, and a shared commitment to reform.