New York – Although East Timor continues to make progress towards self-sufficiency, it still requires international assistance for the foreseeable future, a senior United Nations official has told the Security Council.

Hedi Annabi, Assistant Secretary-General for Peacekeeping Operations, said Tuesday that demonstrations in July outside Dili's government palace were an indication of underlying tensions in Timorese society.

"Social and economic development and the creation of jobs are essential to deal with the root causes of these problems", Annabi told the Security Council, which had met to discuss the latest report on Timor by Secretary-General Kofi Annan.

In his brief on Timor, Annan had noted that with less than a year before the UN pullout from the new nation, Dili has made significant progress to running its own affairs.

The United Nations Mission of Support in East Timor (UNMISET) concludes its mission next May and Annabi told the Security Council that much remained to be done in Timor before the mandate expires.

He said the situation in Timor would be reviewed in October to determine whether any changes would be made to the size, composition and tasks of UNMISET.

The UN downsized its mission in May, leaving only 604 police, troops and military observers after July 31, from 3,000 previously.

Annabi warned the Security Council that Timor's justice sector continues to suffer a shortage of qualified officials and limited infrastructures, casing delays to the legal process and violations of prisoners' rights.

Timor's UN ambassador, Josi Luis Guterres, said his country would continue to rely on support from international financial institutions to promote development.

Dili's state budget of about USD 70 million was almost entirely dependant on foreign aid and would remain so for several years until oil revenues began to flow into Timor's state coffers, he told the Security Council.