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New Matilda Independent News, Public Policy, Australian Politics Online
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Source of article (16 June 2006):
ON LINE opinion:
Australia's e-journal of social and political debate
Achievements of a “failed state”
By Tim Anderson
Posted Friday, 16 June 2006
The post-independence crisis in Timor Leste has drawn attention to the
fragility of institutions in that newly independent country. Australian
intervention in 2006 has been accompanied by menacing suggestions of a
“failed state” - not just a state that cannot govern itself, but one
that poses a threat to others, thus justifying intervention. Yet
foreign intervention is anathema to independence and self-governance
(in East Timorese terms, “ukun rasik an”).
The immediate danger to Timor Leste's established right to
self-determination is likely to be an Australian neo-colonial dominance
that could reverse the independent path the nation has undertaken, with
its new constitution, national development plan and distinctive
policies. The internationalisation of the intervention (the UN
involvement) only slightly diminishes this threat. Powerful Australian
interests are talking openly about the need for a strong Australian
hand on East Timorese policy.
The Fretilin Government, led by Prime Minister Mari Alkatiri, has
attempted to manage the tensions of independence, appeasing Indonesia,
joining the World Bank but not borrowing money, and maintaining a civil
relationship with Australia, while maintaining its rights in the oil
and gas dispute.
That civil relationship appeared to have endured until the recent
crisis, when open hostility to Alkatiri, in particular, erupted. This
hostility was out of all proportion to the share of responsibility
Alkatiri may have had for the army crisis.
Reflecting the depth of the frosty relationship with the Fretilin-led
government, the Australian Government and corporate media have not even
condemned the renegade soldiers who took up arms against their own
government and shot people in the street. John Howard and Alexander
Downer pretend an “even-handed” policy to Timor Leste's elected
government and its violent renegades.
President Xanana Gusmao has so far escaped criticism for not denouncing
the renegade soldiers and gangs that are acting in his name. Xanana has
great domestic popularity and has not been so closely implicated in the
policy conflicts with Australia.
The attacks on Prime Minister Alkatiri reflect underlying tensions that
have been building for some time. The prime minister, a strong economic
nationalist, remains the country's chief strategist. Many of the
tensions relate to distinctive policy developments in the seven years
since 1999. The best known achievements have been in the oil and gas
dispute, but there have also been modest advances in agriculture,
health and education. Yet associated with many of these advances has
been opposition or hostility from Australia, and its mentor, the US.
There was wide support for the construction of a new constitution (with
a bill of rights, a highly democratic electoral system, recognition of
shared national resources and customary law) and a development plan.
The pursuit of a greedy Australian Government over East Timor's oil and
gas resources proved more difficult. Alkatiri led the first round of
negotiations (mainly over the Bayu-Undan field), with broad East
Timorese and Australian support. The deal shifted Australia's 80-20
offer to a 90-10 settlement. The second round (over the Greater Sunrise
field) shifted the Australian “final” position of 18-82 to a settlement
In both sets of talks there was considerable aggravation, particularly
the latter, where Australia got its way in deferring fixed maritime
boundaries. Australian officials and some academics told the East
Timorese again and again that they were “unrealistic” and would get
nowhere. Downer told Alkatiri he would give him "a lesson" in politics.
Downer and the “realists” were wrong. The East Timorese did not get
their full claim, but they came out several billion dollars ahead.
On agriculture both the World Bank and the Australian Government
opposed the transitional government's plans (2000-02) to rehabilitate
rice fields, and to use aid money for public grain silos and a public
abattoir. That is, the Australian Government - blinded by neo-liberal
ideology, and their belief in privatisation and export orientation -
blocked East Timorese developmental plans. Yet few interventions are
more destructive to development than obstructing a small, post-colonial
nation defining and creating its own institutions.
Despite this obstruction, after independence the Alkatiri Government
built public grain silos (with FAO assistance) and promoted domestic
rice production (with Japanese assistance) as a key policy goal.
Despite a lack of resources, a focus on rice production is now embedded
in the country's food security policy. A recent UNDP report tells us
that the domestic rice production of 37,000 tonnes in 1998 rose to
65,000 tonnes in 2004. This means less dependence on imported rice, an
important concern for a country with a history of famines. However, the
2006 crisis has again disrupted domestic supply.
There have been modest gains in education and health. Gross school
enrolments increased from 59 per cent in 1999 to 66 per cent in 2004.
The biggest improvement was upper secondary school, where enrolment
ratios rose from 37 per cent to 46 per cent (they had fallen to 27 per
cent in 2001). Infant mortality was static (mainly due to a lack of
skilled birth assistants) but under-5 mortality continued to decline.
However, the most significant development in health has been the
collaboration with Cuba, which began in 2004. Cuba, a poor socialist
country, has the best health system in Latin America and the largest
bilateral medical aid program in the world. There are now around 100
Cuban doctors in Timor Leste, most based at village level, and several
hundred young East Timorese are studying medicine in Cuba.
In December 2005 Alkatiri travelled to Cuba, visiting the students and
the Cuban Government. He secured an increase in promised medical
scholarships from 200 to 600. This could generate an enormous rise in
health workers, particularly considering the whole country, as at 2005,
only had 45 doctors. US Ambassador Grover Joseph Rees III, predictably,
protested the development of a relationship with Cuba.
The US ambassador also supported the 2005 church-led protests at
government attempts to make religious education optional in schools.
This rally turned into demands for the criminalisation of homosexuality
and abortion, the removal of “communists” from the government and for
the resignation of Prime Minister Alkatiri. The US provided logistical
support for the demonstrators - porta loos, to help sustain their
protests. The government backed down, keeping religious education
The other side to this developmental picture is the growth of
unemployment and income poverty in Dili, which has seen its urban
population double in recent years. The dislocation of 1999 and the
“bubble” economy of 2000-02 contributed to the urban migration, but
maintenance of rural programs could help slow it. Yet Australia and the
World Bank rarely provide support for the subsistence sector and
domestic markets. The large unemployed and young urban population has
added to the strains that have built up around the Xanana-Mari Alkatiri
rivalry, a rivalry which has been exploited by Australia in the 2006
There was international praise for Alkatiri's fiscal conservative
management, both in the budgets and in managing oil and gas revenues.
However there is also international resentment at his controls over
investment and his resource nationalism. In 2003 Alkatiri said,
"Independence means sovereignty over all our resources". He has so far
maintained the popular “debt free” start for the country, though there
are plans to borrow from the Kuwait Fund, to support a national energy
grid. Bypassing the World Bank in this way might cause further
consternation in Australia and the US.
Caution over foreign investment and borrowing is one area where Jose
Ramos Horta - the talented diplomat - differs from his prime minister.
Ramos Horta has said he would prefer to "move faster" and would support
more "facilities, privileges" for foreign investors. Asserting
extraordinary independence from government policy, he is also the only
Timor Leste minister to support the disastrous Iraq war.
The more independent economic path pursued by Alkatiri, and the more
accommodating attitude shown by Ramos Horta, help explain why the
latter has become the “Australian candidate” in the latest Australian
intervention. Australian commentators (with little regard for East
Timorese democratic processes) have openly declared their preference to
replace Alkatiri and Fretilin with some sort of Ramos Horta-led
coalition. Such playing of favourites is a great threat to independent
development and to public institution-building in Timor Leste.
Australian intervention also has immediate dangers. Several senior army
commanders are known to have lost confidence in Xanana because of his
perceived links to renegade army leader Major Alfredo Reinado. Though
it is not yet clear exactly what links Xanana or Ramos Horta may have
with the rebel soldiers, the loyal army commanders are likely to resist
any Australian-backed attempts to depose Alkatiri and the Fretilin
It seems likely that, in his attempts to overthrow Alkatiri, Reinado
had at least implicit support from Catholic Church leaders and the
Australian and US governments, as well as some understandings with
Xanana. Observers have noted that Reinado's wife works at the US
Embassy and that Reinado has undertaken extensive leadership training
with the Australian armed forces. One Australian officer has said,
despite the rebellion, that he regards Reinado as a future political
leader. These are hostile acts against the East Timorese nation.
Whatever their prior knowledge of the Reinado-led rebellion, the
Australian Government made good use of it to undermine the elected
government of Timor Leste. However, domestic compromises (including two
ministerial resignations, the promotion of Ramos Horta and a UN
inquiry) seem to have forced a temporary back-down. Yet if the “palace
coup” does not succeed on this occasion, we will need to closely watch
progress in what The Australian calls the now “poisoned” relationship
between the Howard and the Alkatiri governments. At stake is an
independent economic path for Timor Leste.
First published in New Matilda on June
Tim Anderson is a lecturer at the School of Political Economy, Sydney
University and is a member of the Committee of Management of AID/WATCH
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