SYDNEY, Australia (CNN) -- The rich world must double its aid for developing countries to $100 billion a year if the global anti-poverty pledge made in 2000 is to be met, the United Nations says.
Releasing its 2003 Human Development Report, the UN said Tuesday that despite progress, more than 1 billion people still live in extreme poverty, and living standards in some countries are getting worse.
The report's Human Development Index, which ranks 175 countries in terms of life expectancy, educational attainment and adjusted real income, shows Norway ranks the highest, followed by Iceland, Sweden, Australia and the Netherlands.
A large majority of the "low human development" countries came from sub-Saharan Africa, with Sierra Leone ranked the lowest.
Improved economic performance in China (ranked 104th) and India (127th) has drastically reduced numbers living in extreme poverty, the report says.
In China, economic growth has lifted 150 million people out of extreme poverty in the past decade.
But the report warns the world is facing an acute development crisis, with many poor nations suffering severe socio-economic reversals.
The world's newest nation, East Timor, is yet to be ranked, but would likely be placed between Rwanda (158th) and Benin (159th). This puts it in the "low human development" range.
Despite this low position, East Timor's Foreign Minister Jose Ramos Horta says his country has made enormous progress, thanks to an excellent partnership with the United Nations.
Horta concedes that big improvements are still needed.
"Security is a problem, an issue -- at least with public perception," Horta told reporters at the release of the UN report in Sydney Tuesday.
East Timor came into being after a bloody separation from Indonesia. In 1999, after a majority of East Timor people voted for independence, hundreds lost their lives in attacks by Indonesia-backed militia groups.
"If we cannot attract investment, then we cannot achieve the millennium goals," Horta said.
These goals, set by world leaders at the UN Millennium Summit in September 2000, aim to lift hundreds of millions of people out of extreme poverty by 2015.
Horta recognises that as a new nation, it will take time for East Timor to improve its position.
He believes that this is achievable by firstly "bringing the government to the people", with all government ministers travelling through the country, including visiting remote rural villages, to discuss conditions with its citizens.
He said international governments could help developing nations by both providing aid and forgiving debt.
Despite pushing for more aid from rich countries, the UN also wants to make undeveloped nations less dependent on aid flows.
It believes that the developed nations can help by providing poorer nations with resources to help them gain independence -- for example providing technicians to educate local people in using their native resources.
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