The objective is to improve the efficacy, efficiency and impact of Timor-Leste/EC cooperation by enabling the NAO to perform and fulfil its responsabilities as set in the Cotonou Agreement.

1. Improved structure and internal organisation of the NAO's technical services: internal organisation (operational and financial) within Aid Effectiveness Directorate clearly defined, functional and hierarchical relationships established, internal procedures and control (incl quality control) instituted, archiving/filing and accounting systems and EDF payment flow charts set up, and local staff adequately trained.

2. EC-funded Projects/Programmes identified, formulated and implemented: enhanced capacity of NAO office - as Contracting Authority - and line ministries involved in EDF implementation - as Supervisors - to identify, formulate and implement projects (funded NIP, intra-ACP or regional resources) in accordance with EC rules and procedures, and mainstreaming cross cutting issues through transfer of know-how and project cycle management.

3. Improved policy, strategic and coordingation funcions of the NAO office: greater awareness among key stakeholders on the main issues regarding development cooperationa and more specifically EC strategies and policies, and improved mainstreaming of cross cutting issues. The support to awareness raising will include also the Ministry of Tourism Industry and Trade in order to anhance its export potential. Improved coordination with other Development Partners through the active involvement of the NAO's office in aid effectiveness activities, and improved dialogue with stakeholders, including Non State Actors.

4. Increased awareness among key actors and civil society of the Cotonou Partnership and EDF activities: participation in and organisation of events, training as well on Cotonou Partnership Agreement, EDF implementation, cross cutting issues and project implementation.

5. Increased participation of Timor-Leste in regional and intercountries EDF programs: The participation of Timor-Leste in Pacific 10th EDF regional program, and PALOP-TL multi-country program is increased. The capacity of Timorese institutions and non-state actors to beneficiate and participate in EDF multi-countries programs, in water and energy facilites and to apply to grants on EC budget lines is increased.