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Nov 28, 2013

The difficulties of development in Timor-Leste

The difficulties of development in Timor-Leste


The difficulties of development in Timor-Leste

By Joanne Wallis and Pyone Myat Thu on  November 27, 2013
Demountables in Timor-LesteIn Timor-Leste 41% of the population lives below the basic needs poverty line, with estimates [pdf] that 58% of communities live in poor housing conditions and the majority have no access to clean water and sanitationYet across the country hundreds of brand new prefabricated houses lie vacant. These houses, the product of the government’s 2011 Millennium Development Goals (MDG) Suco Program [pdf], exemplify the difficulties of development in one of Australia’s nearest neighbours.
The Timor-Leste government has access to significant oil and gas revenues from the Timor Sea, with US$14.6 billion in its sovereign wealth Petroleum Fund. These revenues have funded a raft of social security schemes and massive investments in infrastructure. However, the government faces a significant challenge: some projections forecast [pdf] that these revenues will be exhausted by 2025, and there is presently no obvious way to replace them. This means that the development decisions the government makes in the next few years will be critical to determining whether Timor-Leste has a future as a thriving middle-income state, or whether it declines further into poverty.
The government has opted to focus the bulk of its development spending on infrastructure, with the rationale that this is necessary for economic development. However, infrastructure development has proved difficult and budget execution has been poor; it is estimated at less than 15% on most projects.
The MDG Suco Program, though not an infrastructure program itself, illustrates the difficulties of infrastructure development. Under the program the government awarded [pdf] a US$144 million contract (later reduced [pdf] to US$87 million) to an Indonesian company to import approximately 9,000 prefabricated houses. The initial plan was that five of these houses would be erected in every one of Timor-Leste’s 2,225 aldeia (hamlets) and would be occupied by vulnerable members of the community, such as the elderly and disabled, female-headed households and veterans of the resistance to Indonesian occupation. The goal was that more than 55,000 houses would be built by 2015 in order to help meet Timor-Leste’s MDG targets, and that the houses would have solar energy, water and sanitation.
Timor-Leste NGO La’o Hamutuk has described the program as a ‘lost opportunity’, because it used imported rather than local materials and did not support local employment or small businesses. The program was implemented without the adequate participation of the communities it would target and effect, and there are questions over whether the prefabricated houses are culturally and environmentally appropriate for tropical Timor-Leste. Moreover, many of the houses that have been put in place are unoccupied, slowly deteriorating in Timor-Leste’s harsh climate.
Those MDG Suco Program houses that are occupied demonstrate additional challenges. At the periphery of the village of Uma Boco on the south coast of Manatuto district, 126 of the prefabricated houses have been constructed in a cleared forest – a clear departure from the original plan. Despite the fact that all the houses have been allocated to select ‘vulnerable’ families, including 26 houses for younger families, over half remained unoccupied as of September 2013. Although the houses use green energy and the light-coloured roofs do well to reflect the tropical sun’s radiation, there are some inherent flaws in the project design and implementation. Foremost, there is the issue of poor access to clean water. Families began to move into this settlement in June 2013, yet their dwellings were still unconnected to clean water sources in September. Residents stated that they walked to the main Uma Boco village to use the water pumps and taps to wash, clean and fetch water. Water scarcity has also meant that residents were unable to use the toilets fitted in their houses, and instead they were utilising the surrounding forest for such needs.
Furthermore, the MDG houses are designed in such a way that household sewage and waste flow out into on-site open drains, which can promote waterborne contamination and diseases, posing greater health implications – particularly for children and the elderly – and environmental damage in the long-term. Moreover, the majority of rural Timorese families continue to rely on cheap firewood for cooking and the kitchen is typically separated from the main residence. Unsurprisingly, small thatched shelters have been informally constructed behind some houses for this purpose.
Each household only has a small plot of land surrounding their dwelling to grow food. Some families have planted maize, peanuts and vegetables, but as they wait for their first harvest they are reliant on larger family fields at a distance for everyday consumption and income. A number of residents raised chickens, and stressed that they were strictly not permitted to keep other livestock such as pigs, goats or cattle in the settlement to maintain hygienic living conditions. Once again, they turned to family relatives who had access to larger plots of land in the main village to rear animals and keep watch over them. Ironically, by constructing these MDG houses away from local communities, they may do more harm by limiting access to kin relations, livelihood resources and social services for those who need them most. Separating disadvantaged families from their communities may adversely perpetuate local stigmas associated with physical disabilities and mental health issues. The construction of social housing cannot be conceived merely as a technical feat, but requires a holistic understanding of local livelihoods and social realities.
The MDG Suco Program is paved with good intentions. The good news is perhaps that because of slow implementationonly US$14 million [pdf] of the US$93 million allocated to the program in 2012 was spent. There is still time to rethink the program.
The difficulties of the program highlight the challenges that face Timor-Leste. While infrastructure is important to Timor-Leste’s economic development, the government cannot afford for its finite resources to be wasted on poorly conceived and executed programs.
With these issues in mind, the Australian National University is hosting a two day Timor-Leste Update on 28 and 29 November 2013. More information can be found here.
Dr Joanne Wallis and Dr Pyone Myat Thu are from the School of International, Political and Strategic Studies in the College of Asia and the Pacific at the Australian National University.

Nov 27, 2013

Timor-Leste is the Portuguese-speaking country with most competitive tax system



Timor-Leste (East Timor) is the Portuguese-speaking country with the best classification and Brazil the worst on the “Paying Taxes 2014” report on tax competitiveness drawn up by PricewaterhouseCoopers (PwC).
According to the PwC report that analyses the tax competitiveness of 189 economies, Timor-Leste is ranked 55th based on three indicators selected by the team of consultants: Overall rate of taxation, number of hours spent dealing with tax obligations, and number of payments required.
Cabo Verde (Cape Verde) was ranked in 80th place, Portugal in 81st, Mozambique in 129th, Guinea Bissau in 153rd, Angola in 155th, Sao Tome and Principe in 156th and Brazil, in last place out of the eight Portuguese-speaking nations, in 159th place.
According to the report drawn up by PricewaterhouseCoopers in partnership with the International Financial Corporation (IFC), of the World Bank group, Cabo Verde rose 22 places in the ranking compared to last year’s report, Mozambique fell 24 places and Angola fell by one place. (macauhub)

Nov 17, 2013

26-floor building is constructed at the center of Dili


AGP building in Caicoli - Dili. Photo: Francisco M. Branco - Facebook



RenovaTimor - Two Indonesian investors, Tomy Winata and Franky Tjahyadikarta are investing in 26-floor building in Dili, the capital of Timor-Leste. According to THETIMORNEWS.com, the construction has started last Saturday, 16 November 2013 and is estimated to finish in two to three years time. There will be hotels, shopping mall, offices, conference halls and other facilities that cater to the needs of the residents of Dili.

The construction of the first ever tallest building in the youngest country in Southeast Asia is so far the biggest foreign investment in the country, along with Timorese investor group, TimorPlaza.  Tomy Winata’s AGP group will spend Rp. 300 million (US$26,215.67 based on current XR) for the first phase of the construction.

The two investors are rated among Indonesian rich man. In 2006, Forbes rated Tomy Winata as  one among 40 richest Indonesians. Mr. Winata is interested in banking, property and infrastructure and many more. Franky Tjahyadikarta, on the other hand, is one of the founder and shareholder of Alila Hotels and Resorts, an Indonesian brand of luxury hotels that has gained name globally since its establishment in 2001.   

The ground breaking ceremony took place five days after the country’s outgoing leader and Prime Minister Xanana Gusmao announced his resignation from Prime Ministerial office in 2015. However, Mr. Gusmao, as quoted by THETIMORNEWS.com, assured the AGP and Alila investment saying the Timor Leste government has its full backing to foreign investors who invest in the country.

“This is not a small investment, I hope AGP’s investment gives motivation to other foreign investors because the government supports and gives full trust to foreign investors in this country.”

The Prime Minister added that his country has clear direction towards development, his 2030 plan, compared to other countries who lost their way of development in spite of having achieved independence for 20, 50 and 80 years.

Timor Leste is so far considered as one of the fastest growing economy in the world with an average GDP growth rate of 8% in the last five years. The country’s main income so far is from offshore oil exploration but its National Development Plan (PEDN 2030) stated its future economy to be based on agriculture, tourism and services.  

Currently, the young country offers a lot of opportunities for foreign investment both based on bilateral agreements as well as multilateral agreements.    

The country also reviewed its investment law in 2011 to provide basis for foreign investment friendly. 



Artha Graha Bangun AGP Square 26 Lantai di Timor-Leste

PM Xanana berbincang dengan Tomy Winata saat akan melakukan pemancangan tiang untuk pemangunan Gedung AGP Square yang dibangun di Kota Dili berlantai 26. Foto TTN/Gantry MeilanaPM Xanana berbincang dengan Tomy Winata saat akan melakukan pemancangan tiang untuk pemangunan Gedung AGP Square yang dibangun di Kota Dili berlantai 26. Foto TTN/Gantry MeilanaDILI, THETIMORNEWS.com - Dua Konglomerat asal Indonesia, Tomy Winata yang sebagai pemilik Artha Graha Gorup, dan Franky Tjahyadikarta, pemilik Alila Hotel secara resmi telah membangun gedung berlantai 26 di Dili, Timor-Leste.
Gedung berlantai 26 yang berlokasi di jantung Kota Dili ini diberi nama Artha Graha Peduli (AGP) Square yang pembangunannya diserahkan kepada perusahaan BUMN Indonesia, PT. Pembangunan Perumahan dan akan rampung dalam 2 hingga 3 tahun.
Pembangunan AGP Square ini telah dimulai dengan pemancangan tiang pertama yang disaksikan langsung oleh Perdana Menteri Xanana Gusmão, serta wakilnya Fernando La Sama de Araujo, dan beberapa menteri dan sekretaris negara, Sabtu (16/11/2013).

PM Xanana ketika memberikan sambutan dalam acara pemancangan tiang pertama Gedung AGP Square milik Tomy Winata dan Franky Tjahyadikarta yang akan dibangun di pusat kota Dili. Foto: TTN/Gantry MeilanaPM Xanana ketika memberikan sambutan dalam acara pemancangan tiang pertama Gedung AGP Square milik Tomy Winata dan Franky Tjahyadikarta yang akan dibangun di pusat kota Dili. Foto: TTN/Gantry MeilanaMenjawab pertanyaan thetimornews.com Tommy Winata yang didampingi Franky Tjahyadikarta mengatakan bahwa tujuan pihaknya melakukan invetasi di Timor-Leste adalah seabagi wujud kerjasama dan persahabatan antara kedua negara yang telah dibicarakan oleh masing-masing kepala negara.
"Harapan dari investasi ini semoga menjadi lambang persahabatan yang baik antara Indonesia dan Timor-Leste," kata Tomy Winata.
Dijelaskannya, dalam AGP Square ini nantinya akan terdapat hotel, shoping mall, perkantoran, konferensia hall dan fasilitas lainnya yang akan disedia sesuai kebutuhan masyarakat Kota Dili.
"Investasi tahap pertama dalam pembangunan AGP Square sekitar Rp. 300 Milyar," jelas Franky Tjahyadikarta.
Dalama sambutannya, PM Xanana Gusmão menyatakan dengan investasi yang dilakukan oleh dua investor Indonesia ini semoga menjadi motivasi bagi investor-investor lainnya baik dari dalam negeri, maupun luar negeri khususnya.
"Ini bukan investasi kecil, semoga apa yang dilakukan AGP bisa memberi motivasi kepada investor yang lain ke negara ini, karena pemerintah mendukung dan memberi kepercayaan penuh kepada investor di sini (Timor-Leste, red)," kata PM Xanana.
Selain itu, kepada para investor luar negeri yang mau berinvestasi di Timor-Leste, pemerintah memberikan jaminan dengan memberikan kepercayaan penuh, karena negeri ini memiliki arah pembangunan yang jelas.
"Banyak negara yang saya kunjungi telah merdeka puluhan tahun, 10, 20, 50 bahkan ada yang 80 tahun telah merdeka, tidak memiliki arah pembangunannya sendiri, tidak jelas, namun Timor Leste memiliki arah pembangunan yang jelas dan kami (pemerintah) akan memberikan kepercayaan penuh itu kepada para investor," kata PM Xanana.
Dengan investasi yang dilakukan para investor luar negeri, PM Xanana juga berharap masyakaratnya dapat terus berpartisipasi dalam pembangunan dan terus berusaha menciptakan atau membangun sesuatu yang baru dan lebih baik lagi.

Nov 11, 2013

Timor Leste on the ASEAN waiting list

Timor Leste on the ASEAN waiting list: Aspiring ASEAN member Timor Leste appears likely to remain on the outside for at least another year, as Myanmar’s Ministry of Foreign Affairs says the tiny country has not yet done enough to justify entry to the 10-member bloc.


In preparation for taking the helm of the group in 2014, the government has been in discussions with regional experts regarding Timor Leste’s application, ASEAN Affairs Department deputy director U Aung Htoo said.
However, the government believes Timor Leste has a number of shortcomings that make joining the group in 2014 impossible.
One example, U Aung Htoo said, is that Timor Leste has failed to build embassies in all 10 ASEAN member nations, a prerequisite under the current entry requirements. Timor Leste does not have an embassy in Myanmar but has said it plans to build one in Nay Pyi Taw.
“Timor Leste needs to follow the ASEAN Charter and Road Map but they are not ready for that,” U Aung Htoo said.
Jim Della-Giacoma, the International Crisis Group's project director for Southeast Asia, said building, staffing and operating the embassies would entail “considerable costs” to Timor Leste, whose economy is slowly recovering from a bloody 25-year struggle for independence from Indonesia.
Mr Della-Giacoma said Timor Leste remains the “poor cousin of geographic Southeast Asia” and sending representatives to numerous ASEAN meetings and summits, of which there are more than 1000 each year, would be a financial burden.
Its lack of infrastructure, including road and air links, means it would also not be in a position to host large meetings of ASEAN officials.
In September, Timor Leste Prime Minister Xanana Gusmao spent five days in Yangon and Nay Pyi Taw in an attempt to bolster his country’s relations with Myanmar. Though the trip was received front-page coverage in state-run newspapers for four straight days, Mr Della-Giacoma said it is unlikely to have a significant impact on bilateral ties.
“There is little diplomatic solidarity between these two very different countries,” said Mr Della-Giacoma.
Other ASEAN members have said they support the idea of Timor Leste joining the group, which now encompasses more than 600 million people and has an economy of more than US$2 trillion.
Indonesia, which brutally occupied Timor Leste from December 1975 to October 1999, has been the most supportive of Timor Leste’s push for membership, and was chair of ASEAN in 2011 when Timor Leste submitted its formal application to join.
Despite this support from one of the bloc’s heavyweights, Timor Leste is likely to encounter opposition from other quarters.
“There are a number of key ASEAN member states that do not consider Timor-Leste ready to join ASEAN,” said Dr Hank Lim, a senior research fellow at the Singapore Institute of International Affairs.
No country has been stronger in its opposition than Singapore, which has argued that Timor Leste would provide little to the group and would instead be a substantial economic burden as the bloc enters the final stages of preparation for the ASEAN Economic Community.
Timor Leste has a population of 1.2 million and a GDP of $1.29 billion in 2012, according to figures from the World Bank. Its economy is less than 15 percent of the size of ASEAN’s next-smallest, Laos, which has a GDP of $9.2 billion. The city-state of Singapore, by contrast, is an economic powerhouse with a population of 5.2 million and a GDP of $274.7 billion.
Though Singaporean Prime Minister Lee Hsien Loong said in September that his country would not block Timor Leste’s bid to join ASEAN but that it required “careful consideration” before approval.
“At the end of the day,” said Danny Chian Siong Lee, director for Community Affairs Development at the ASEAN Secretariat, “we want to make sure that Timor-Leste’s membership will bring the most benefits to its people, while managing the impact effectively.”

Nov 5, 2013

Xanana recognizes no economic benefits becoming CPLP member

PM Xanana Gusmao and CPLP

*Independente, November 4, 2013 language source: Tetun 


Prime Minister Xanana Gusmao has made comments regarding Timor-Leste’s inclusion of Portuguese Language Community (CPLP), saying no benefits which the country gains from CPLP. PM Xanana said mostly CPLP’s programs were about history, language and culture. 

“CPLP is up to now only talking on culture, language and history. But in fact the world is currently talking about money,” he said. 

He affirmed that Timor-Leste had been joining CPLP for few years, but he had never seen any benefit for each country which was joining it and said CPLP had only wasted time talking about its history. 

Xanana added that if CPLP would keep up with the history and that would impact CPLP state members’ economy.


Blogger's note:
Well-noted, Your Excellency. It is time to remind old friends to follow the changing of time. CPLP could be a powerful economic bloc, there are Brasil, Angola, Macau and TL. But there are two questions: what is GoTL's proposal on this? how about TL's bid to join the Commonwealth countries?

Can East Timor dodge the 'resource curse'? - Features - Al Jazeera English

Can East Timor dodge the 'resource curse'? - Features - Al Jazeera English


Dili, East Timor - The 2014 budget unveiled last week by tiny East Timor is a $1.5bn spending plan funded almost exclusively - 95 percent - by lucrative oil and gas revenues. One of the fastest-growing budgets in the world in recent years, it ballooned from $64m in 2004 to $604m in 2009.
That the budget depends on a single, finite resource that could be depleted in a generation has some worrying the country may fall victim to the same "resource curse" that has seen other developing countries lose their wealth to inexperience, mismanagement and corruption.

"Given how much money has poured through the country, and given how much money the government has access to, it's fairly depressing," said Anna Powles, an academic researcher who worked in East Timor for eight years as an adviser to the government and several non-government organisations.
East Timor is one of the most oil-dependent countries in the world, according to the International Monetary Fund. The country's non-oil industries, such as organic coffee and tourism, generate a fraction of the amount as the oil does.

A trust fund for petroleum revenues, modelled on Norway's conservative sovereign wealth fund, is now worth close to $14bn. Although no more than 3 percent of the fund was meant to be withdrawn in any given year, it has been overdrawn regularly in recent times.

"It's an enormous concern," said Powles, now a lecturer at the Centre for Defence and Security Studies at the University of New South Wales. "The whole rationale for setting it up using the Norwegian system was to ensure there was sustainability. It's not enormously surprising that it's been tapped into to the degree that it has been."

The 2014 budget calls for taking $903m from the petroleum fund, while the 3 percent sustainability cap would limit that withdrawal to $632m.

To read more, click here

China offers two ships to F-FDTL

The State Secretary for Defense - Julio Tomas Pinto

*Televizaun Timor-Leste, October 31, 2013 language source: Tetun

The Government of China has officially handed over two mini warships to the Timorese Defense Force (F-FDTL) to be used for doing patrol in the northern coast of Timor-Leste. 


Speaking to journalists, State Secretary for Defense, Julio Thomas Pinto said the Chinese Government provided the two ships to F-FDTL as it was asked by the Timorese Government. 

”We discussed with the president of the republic on how China can help us as every year it always allocates money for us,” Pinto said. 

Pinto affirmed that, the Government asked many things, but the Chinese Government decided to provide Timor- Leste with two mini warships.

Nov 3, 2013

TIMOR LESTE is one among countries spied by Australia


click on the picture to read the exclusive report from smh


Timor Leste Termasuk Negara yang Disadap Australia


Canberra – Tak hanya di Indonesia, Kedutaan Besar Australia di negara Asia lainnya juga digunakan untuk mengumpulkan informasi intelijen sebagai bagian dari upaya pengawasan global Badan Keamanan Nasional Amerika Serikat (NSA). Menurut laporan Der Spiegel, sedikitnya ada lima kedutaan besar yang aktif melakukan penyadapan, yaitu di Cina, Thailand, Indonesia, Vietnam, dan Timor Leste.
Selain itu, penyadapan juga dilakukan oleh dua kantor komisi tinggi negara di negara-negara Persemakmuran –setara dengan kedutaan besar– yaitu di Kuala Lumpur, Malaysia dan Port Moresby, Papua Nugini.
Laporan Der Spiegel dan The Sydney Morning Herald mengatakan bahwa program pengumpulan intelijen yang dilakukan Australia ini disebut sebagai program “Stateroom”. Mengutip data NSA yang bocor, penyadapan itu dioperasikan oleh Australian Defence Signals Directorate.
Seorang mantan pejabat Australia mengatakan bahwa Negeri Kanguru itu ambil bagian dalam pengumpulan intelijen dengan NSA semata-mata untuk memajukan kepentingan nasional sendiri, selain berkontribusi terhadap aliansi dengan Washington. Operasi intelijen Australia sudah berlangsung dalam berbagai bentuk selama 20 sampai 30 tahun, kata mantan pejabat itu.
Khusus tentang Indonesia, Australia telah lama merasa perlu untuk mengumpulkan informasi di Indonesia, negara Muslim terbesar di dunia yang terletak di sebelah utara Australia, kata sumber yang sama. Stabilitas politik dan masalah keamanan adalah prioritas tertinggi penyadapan Australia selama bertahun-tahun. Penyadapan juga diintensifkan, katanya, setelah isu penyelundupan manusia ke Australia dari Indonesia meningkat.
“Ini dilakukan bukan sebagai bantuan pada AS,” kata mantan pejabat itu. “Tapi lebih kooperatif daripada atas permintaan AS.”
Sebelumnya, Philip Dorling, penulis dan koresponden Canberra Times, mengaku tak heranmendengar kabar bahwa Australia menggunakan Kedutaan Besar-nya di luar negeri, termasuk di Jakarta, untuk melakukan penyadapan telepon dan pengumpulan informasi rahasia. “Australia telah lama memata-matai tetangga kita, khususnya Indonesia, dan kita telah lama berusaha untuk mengambil keuntungan dari itu dalam diplomasi kita,” kata Dorling, seperti ditulis dalam kolomnya di Sydney Morning Herald, Kamis, 31 Oktober 2013.
Menurut Dorling, Kedutaan Besar Australia di Jakarta adalah pos luar negeri pertama Badan Intelijen Australia. Berdasarkan informasi dari buku harian yang diterbitkan diplomat senior Australia diketahui bahwa Australian Defence Signals Bureau, yang kini menjadi Defence Signals Directorate, rutin membaca kabel diplomatik Indonesia sejak pertengahan 1950-an dan sesudahnya.
Aksi spionase Australia dimulai dengan kerja sama erat dengan intelijen Inggris Secret Intelligence Service (SIS), atau yang lebih akrab dikenal dengan nama MI6, dan Government Communication Headquarter (GCHQ). Seiring berjalannya waktu, Intelijen Australia juga berkolaborasi dengan badan intelijen Amerika Serikat Central Intelligence Agency (CIA) dan National Security Agency (NSA).”Dan kami tidak pernah berhenti memata-matai,” kata Dorling.tempo

A picture of thousand stories

Uamoritula with Mundo Perdido as the background. Photo: Aze da Silva Alves