Subject: Washington Post: The Business of Rebuilding East Timor

Washington Post Monday, January 3, 2000

The Business of Rebuilding

Entrepreneurs Follow the Relief Workers into East Timor

By Keith B. Richburg Washington Post Foreign Service

DILI, East Timor—At one of Dili's two new floating hotels last week, it was standing room only at the upper deck bar. Relief workers, U.N. officials, foreign peacekeeping troops and journalists stood shoulder-to-shoulder, swapping stories and exchanging mobile phone numbers as cold beer flowed, music blared and the cook behind the counter had trouble keeping up with the cheeseburger orders.

Outside, the capital's main waterfront road was jammed with new vehicles--Landcruisers, Jeeps, minivans, rental cars--most of them with license plates from Darwin, in Australia's Northern Territory. They plied past block after block of burned-out shells of buildings, although the street is dotted with colorful new restaurants, hotels and bars.

But at the local offices of the Catholic charity Caritas, Rogerio dos Santos, the deputy director, still cannot make an overseas telephone call to his headquarters to ask for more rice.

Before East Timor voted Aug. 30 to become independent from Indonesia--sending Indonesian soldiers and their militia proteges on a rampage of killing and destruction--Caritas was one of the main relief groups distributing rice around the tiny territory.

The group bought rice from Indonesian government warehouses or got it from a companion aid agency in Jakarta. Now, its sources have been cut off, and dozens of foreign relief groups have arrived in town, bringing so much food aid that there is fear of a glut. And the local Caritas office, like every other building here, was looted bare, with all its phones and fax machines stolen.

"I am very, very confused," dos Santos said. "We have no communications with Caritas International. We have no phone, we have no fax machines." He does not mind the massive influx of foreign aid agencies to East Timor--just as he does not mind seeing the increasing number of cars, hotels and restaurants springing up here to cater to the expanding foreign community. But, he said, "Something is wrong."

"There are many dark businesses now in East Timor," he said. "Because there are no laws yet in East Timor. Where do they pay government taxes? And who do they pay it to?" He added: "I understand it, but what can we do? It's not a priority for me--hotels, big cars. The priority for me is that people need food and reconstruction [materials] for their houses."

It is a growing concern. With East Timor now essentially stable, under the protection of an Australian-led peacekeeping force and administered by the United Nations, the territory has graduated from an emergency case to a kind of laboratory for development and reconstruction. Everything here needs rebuilding--and that has brought in hundreds of foreign relief workers from, at last count, 40 agencies, primed with theories of development and years of experience from disaster zones such as Cambodia, Somalia and Rwanda.

And behind the relief workers have come the entrepreneurs, mostly from Australia's northern coast, the "Northern Territory carpetbaggers," as they are sometimes jokingly called. They supply the vehicles, set up the housing and ship in the beer, the refrigerators, the mobile telephones, the fax machines, and just about everything else that the expanding expatriate community needs to survive in relative comfort in a devastated city without stores or basic supplies.

"There's a vacuum here that people are moving to fill," said one Darwin-based businessman, explaining his decision to come to Dili. "Businessmen go everywhere in the world, and this is virgin territory."

While Australians may be the largest and most visible contingent, they are not the only one. Portugal, East Timor's colonial power before Indonesia's 1975 invasion, has returned in force, announcing plans for East Timor's first bank and giving back pay to its former civil servants--using, of course, Portuguese escudos as the currency.

All this has created a bewildering mishmash of currencies--Australian dollars, Portuguese escudos, U.S. dollars, and, still, the Indonesian rupiah, used mostly by small traders and taxi drivers. On the floating hotels, which sailed here from Singapore, the crew is Singapore-based and is paid in Singaporean dollars.

The concern now is that with all the resources being poured into expatriate logistics, the more basic needs of the East Timorese may be ignored--or at least may become far more glaring, by contrast.

Veteran relief workers speak with horror about what they call "the Cambodia problem"--the massive, multibillion dollar effort to rebuild Cambodia where, eight years after the arrival of the U.N. transitional authority, the relief community is the only real source of legitimate income. Average Cambodians remain as poor as they were nearly a decade ago.

Some think "the Cambodia problem" is already occurring in East Timor. "It's real bad," said a longtime official of a U.N. agency with experience in other disaster areas. "I'd like to see some kind of spreading of the income over the population. It's difficult. We need to put money into the real economy, and not just the aid economy. And we need to support the setting up of businesses--and not only Australian businesses."

Among other things, he said, he hoped the ethnic Chinese businessmen who fled during the violence could be persuaded to return.

Jose Ramos-Horta, the Nobel Peace Prize laureate and senior official of the National Council for Timorese Resistance, said he, too, is aware of the potential problem, and is determined to prevent it.

"Frankly, I would never allow this to happen, because it would mean betraying the people," Ramos-Horta said.

"For the time being, we understand," he said. "The town is thoroughly destroyed. We are the ones who asked the United Nations to come. . . . We cannot ask them to endure the same hardships as East Timorese; they are not East Timorese. I just hope, one, the money pledged comes in a timely manner, and, two, a large percentage of it is invested in this country for food, for roads, for schools, to fight malaria."

The aid agencies here bristled when questioned about whether their heavy and increasing presence is benefiting East Timorese. At a recent press conference, the U.N. mission's head of humanitarian operations countered the criticisms with a list of statistics--nearly 15,400 tons of food delivered around 240 sites in East Timor, reaching 453,300 people; 715 tons of shelter material in town Dec. 14, with more on the way; 42,000 children vaccinated against measles; 72 health facilities made operational; 410 tons of maize seed distributed to farmers; 28,000 farm tools distributed, and hundreds of broken or destroyed hand pumps for water now repaired.

A U.N. spokeswoman reminded journalists that the aid workers here are all "guests in this country" and intend to coordinate closely with local groups. And the foreign entrepreneurs flocking to Dili pointed out that their facilities--restaurants, hotels and logistics centers--are providing employment for East Timorese, in a city where few other jobs exist.

So far, the East Timorese do not seem to mind the huge foreign influx; in fact, they still welcome it as heartily as they did the day the peacekeeping troops landed. Children and adults still wave as at foreigners, usually calling out, "Hello, Mister!"

Said Australian Col. Mark Kelly, chief of staff of the peacekeeping operation, "It's such a thrill to hear them. There's an overwhelming joy in their eyes."

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