Subject: SCMP: Sea of Poverty Sinking E. Timor's Dream of Nationhood

South China Morning Post Wednesday, December 3, 2003


Sea of Poverty Sinking East Timor's Dream of Nationhood

PETER KAMMERER, Foreign Editor

East Timorese look at Iraq in wonderment. Hundreds of millions of dollars in aid and investment are pouring into the still unstable Persian Gulf nation, while promised international contributions to their peaceful young democracy have dried up to barely a trickle.

There is a hint of envy, even though Iraqis would argue they are technically still at war. Iraq, with its massive oil reserves, has a bright future. East Timor, tussling with Australia for control of limited quantities of oil and gas, has a less certain one.

A three-day meeting with donor nations starting today in East Timor's capital, Dili, will try to correct perceptions. But observers are not holding their breath. The problem is terrorism. Since the attacks in the US in September 2001, the world's focus has been on security - not poverty, the biggest impediment to East Timor's future.

The nation is the poorest in Asia and ranked among the least developed in the world, on a par with the African country of Rwanda which was the scene of genocide that left up to one million people dead in violence that erupted in 1994.

East Timor's 800,000 struggled with Indonesian brutality until independence was promised in 1999 and the United Nations stepped in to stop widespread violence by militias.

The UN took control and, that December, a donors' meeting in Tokyo promised US$520 million. Independence was granted on May 20, 2002, and the UN is scheduled to pull out next April.

But the promised international commitment has disappeared, usurped by the war on terrorism and Iraq. Between December last year and June, just US$1.15 million was spent by the World Bank-administered Trust Fund for East Timor on development projects in the tiny Southeast Asian island nation. A donors' conference in Madrid in October pledged US$33 billion to Iraq - a country vastly bigger in area than East Timor and with 30 times as many people. Amid such moves, there is a sense among the East Timorese that the effort to deliver to the better-developed Iraqis will be greater.

Out of the global spotlight, East Timorese are suffering. The Australian director of the Catholic charity, Caritas, Jack de Groot, yesterday questioned why some of the world's most vulnerable people were being ignored.

"The only debate we have at the moment is one of security," Mr de Groot said. "We don't seem to have any on poverty eradication or alleviation. All we're after is security at the moment and Iraq fits into that mould. East Timor doesn't."

Mr de Groot was in East Timor last week on a fact-finding mission centred on poverty and health issues. He said that up to next April, 110,000 people - an eighth of the population - would experience food shortages, most because of a two-year drought. Low-nutrition sago had become a staple for many East Timorese, who sell whatever assets they have to buy food to survive. Amid such shortages, the government and World Food Programme planned to begin food distribution next week.

Without increased international attention, such difficulties could be a feature of the country until oil revenues from an oil deal signed with Australia begin to flow in 2007. The problem is money - and East Timor does not have enough.

Its budget last year was US$79 million - the same as a small town in a developed country such as the United States or Britain. Of that, 20 per cent came from taxes, another fifth from oil and gas revenues and the remainder from international donations and agencies such as the UN.

East Timor expert James Fox, the director of the Research School of Asian and Pacific Studies at Australian National University, said East Timorese had little reason for optimism. "It's very hard to realistically run a country in need of as much development as East Timor with a budget their size," he said. "These are the lean years - they're always lean in East Timor."

East Timor's government pins hopes for the future on oil and gas reserves in the Timor Sea between its shores and Australia. But a dispute over the maritime boundary between the two nations is confusing negotiations over when revenues will flow at their fullest. A temporary agreement guarantees US$3 billion to East Timor over the next 20 years, but the dispute has cast doubt over when an estimated US$14 billion more begins flowing.

Talks ended last month without a deal and are expected to resume in April. East Timor's Prime Minister, Mari Alkatiri, accused the giant neighbour of pressure tactics and stalling for its own financial gain.

"It was always deadline over deadline to have it done in a time frame that was not easy for . . . a new country to respond to," he said of the pressure from Australia and oil companies.

Mr Alkatiri said the billions of dollars from oil and gas would "break our dependency from these donors and the whole process of the development of the country would take another step forward".

East Timor argues the border should be drawn in the middle of the 600km of sea separating the two nations - putting 90 per cent of the oil and gas reserves on its side of the line. Australia argues its continental shelf to be the border. In some places that is just 150km from East Timor's coastline.

The present agreement gives East Timor 20 per cent of the Greater Sunrise gas field, the richest in the area, and Australia gets the remainder. East Timor also gets 90 per cent of several fields in a joint development area, but those fields are not as lucrative. The treaties do not cover three other fields - Buffalo, Laminaria and Corralina - which lie on East Timor's side of the disputed area but from which Australia is taking all the revenues.

The urgency for a resolution was expressed by East Timor government spokesperson Jose Gutierrez. He nonetheless was optimistic that a solution could be found. He was hopeful that laws could soon be put in place to attract foreign investors and that the coffee industry, the prime source of income under the Portuguese but destroyed under Indonesian rule, would again become a prime generator of income.

The niche organic coffee market was being eyed and buyers had already been attracted from the US and Europe.

"It's a challenge - we're building a nation from scratch," Mr Gutierrez said. "We're creating everything from zero and it's being done by East Timorese with the help of the UN."

Future prosperity, though, would still seem to be in the hands of outside forces.

Back to December menu
World Leaders Contact List
Human Rights Violations in East Timor
Main Postings Menu