Achievements of a 'Failed State'


The recent Australian intervention in East Timor has been accompanied by menacing suggestions of its being 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.

The immediate danger to East Timor’s self-determination is likely to be an Australian neo-colonial dominance that could reverse the independent path the nation has taken. International and UN involvement in the intervention 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 Marí 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 the corporate media have not even condemned the renegade soldiers who took up arms against their own government and shot people in the street. President Xanana Gusmão has, so far, escaped criticism for not denouncing the soldiers, who are acting in his name.

The attacks on 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 last seven years..

There was wide support from Australia and its mentor, the US, for the drafting 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.

Negotiations over East Timor’s oil and gas resources proved more difficult. Alkatiri led the first round of talks (mainly over the Bayu-Undan field), with broad East Timorese and Australian support. The deal shifted Australia’s 80 (East Timor) – 20 (Australia) offer to a 90-10 settlement. The second round (over the Greater Sunrise field) shifted the Australian ‘final’ position of 18 (East Timor) “ 82 (Australia) to a settlement of 50-50.

In both sets of talks there was considerable aggravation particularly during 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 East Timorese Government’s plans (2000-02) to rehabilitate rice fields, and to use aid money for public grain silos and a public abattoir. Few interventions are more destructive to development than obstructing a small, postcolonial nation defining and creating its own institutions.

Thanks to Alan Moir.

Despite this, after independence, Alkatiri’s Government built public grain silos (with the assistance of the Food and Agriculture Organisation) and backed domestic rice production (with Japanese assistance). Despite a lack of resources, a focus on rice production is now embedded in the country’s food security policy. A recent United Nations Development Program report shows that domestic rice production rose from 37,000 tonnes in 1998 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 recent 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-five mortality continued to decline.

The most significant development in health has been the collaboration with Cuba, which began in 2004. There are now around 100 Cuban doctors in East Timor, most based at village level, and several hundred young East Timorese are studying medicine in Cuba. In December 2005, Alkatiri travelled to Cuba to visit the students and the Cuban Government, and secured an increase in promised medical scholarships from 200 to 600. This could generate an enormous rise in local health workers, particularly considering that, as of 2005, the whole country only had 45 doctors. Predictably, the US Ambassador, Grover Joseph Rees III has protested about the relationship with Cuba.

The US Ambassador also supported the 2005 Church-led protests over 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 porta loos to help sustain the protests. The Government backed down, keeping religious education compulsory.

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 Gusmão-Alkatiri rivalry.

There has been international praise for Alkatiri’s fiscal conservatism; however, there is also resentment of 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, although 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 the talented diplomat José Ramos Horta 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 East Timorese Minister to support the Iraq war.

The more accommodating attitude shown by Ramos Horta helps explain why he has become the ‘Australian candidate’ in the latest Australian intervention. Australian commentators (with little regard for East Timo
rese 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 public institution building.

Australian intervention also has immediate dangers. Several senior army commanders are known to have lost confidence in Gusmão because of his perceived links to renegade army leader Major Alfredo Reinado. Although it is not yet clear exactly what links Gusmão 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 leadership.

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 Gusmão. 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 East Timor. However, domestic compromises (including two ministerial resignations, the promotion of Ramos Horta and a UN inquiry) seem to have forced a temporary backdown.

Yet, if the ‘palace coup’ does not succeed on this occasion, we will need to closely watch the progress in what The Australian calls the ‘poisoned’ relationship between the Howard and Alkatiri Governments. At stake is an independent economic path for East Timor.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.