New York – As the United Nations readies next year's withdrawal of its mission to East Timor, Dili is making significant progress towards running its own affairs, UN Secretary- General Kofi Annan says in a new report debated by the Security Council on Tuesday.

In his latest brief on Timor, Anan says that the world's newest nation has made progress in reaching critical levels of self- sufficiency in administration and internal and external security. Timor's public administration, police and armed forces continue to develop and mature, he notes. Preparations for Timor's first post-independence elections in 2005 are well on course, the UN chief says.

Although there has been "significant achievements in prosecuting perpetrators of serious crimes committed in 1999" around the time of Timor's independence ballot, "many indicted persons remain outside Timor and have not been brought to justice", says Anan.

UN member states, including Indonesia, should make all efforts to ensure that the 279 people indicted for human rights abuses in 1999 who reside outside of Timor do not enjoy continuing impunity, Anan underscores.

Key work still needs to be completed in demarcating Timor's borders with Indonesia, Anan points out, adding that "progress has not been as rapid or as conclusive as hoped".

The UN Mission of Support in East Timor (UNMISET) ends its mandate next May and Anan says continued successful nation building in Timor depends on cooperation between Dili, UNMISET and the international community.