East Timorese recall better life during Indonesia occupation

East Timorese recall better life during Indonesia occupation

Rendi A. Witular, The Jakarta Post, Dili, East Timor

Rich in oil, gas and coffee, the East Timorese had high hopes
that the new country would be prosperous after its independence
from Indonesia in 1999.

However, the lack of foreign direct investment in oil and gas
exploration and the use of the U.S. dollar as its currency has
almost brought the country's economy to a standstill.

The situation has made some East Timorese recall better days
when the country was still Indonesia's 27th province under
president Soeharto.

"We understand that independence is this country's utmost
achievement. But we can't deny the irony that our life now is
harder than before independence," said Nicolai, a 27-year-old
driver working for a car rental company.

He said with a salary of some US$80 per month, he could barely
make ends meet considering his daily expenses of $3. Therefore,
he has taken a side job at a small coffee processing plant.

"When we were still a part of Indonesia, we could afford to
buy food although we didn't have decent jobs. But now, aside from
being expensive, food supply is also limited -- especially in the
remote areas," he said.

According to a report from the U.S. Agency for International
Development, more than two-fifths of East Timor's 900,000 people
live on less than $1 per day and only one in five families has
access to electricity and only two in five families have access
to clean water.

East Timor gained independence from Indonesia in an August
1999 referendum.

After independence, East Timor was temporarily under a United
Nations (UN) transitional administration before the new state,
which occupies half of the island of Timor could directly elect
its leaders.

During the transition period, the UN administration was
optimistic that East Timor would have a self-sufficient economy
within the next six years, with coffee plantations as the main
economic backbone.

But after six years, optimism has faded as many coffee farmers
have gone bankrupt.

Lorenzo, a police officer whose father used to engage in the
coffee business, said that since last year there has been a sharp
decline in coffee demand from overseas following the adoption of
the U.S. dollar as the sole legal currency.

This caused coffee prices to become uncompetitive in the world
market. Indonesian coffee agents, who used to buy the coffee, are
now declining due to the high prices.

Since independence, the UN administration has allowed the East
Timorese to use a number of currencies for exchange aside from
the U.S. dollar -- including the Indonesian rupiah and Australian
dollar, which have a lower value than the greenback.

"Just late last year, we had to destroy tons of coffee beans
because there were no buyers. We also had to prevent the price
from falling due to the abundant stock," said Lorenzo, adding
that he would personally prefer the country to be under the
Indonesian government.

East Timor is known for its organically grown Arabica and
Robusta coffee with its smooth flavor and low acidity. The coffee
business started when the area was still controlled by the
Portuguese who established plantations in East Timor's highlands
several centuries ago.

East Timor legislative member Clementino dos Reis Amaral
acknowledged that the country's economy had declined sharply over
the last three years as the UN staff were departing and foreign
investment was hard to come by.

"The economy is not heading in a prosperous direction yet due
to uncertainty in the business climate with the main concerns
being security, a weak judicial system and poor quality of human
resources," he said.

Amaral said the urgent problem that needed to be immediately
addressed was the rising open unemployment rate -- which has
reached around 50 percent -- and the lack of qualified human
resources.

But East Timor's leaders are optimistic over the country's
economic prospects due to its undeveloped offshore oil and gas
reserves, which is estimated will bring in about $5 billion a
year once exploration starts.

"We may be poor and underdeveloped now. But we are optimistic
that East Timor can be prosperous in the next 15 years, since we
have abundant untapped natural resources," said East Timor
President Xanana Gusmao in a recent joint press conference with
visiting Indonesian President Susilo Bambang Yudhoyono.

At present, East Timor is still negotiating with its neighbor
Australia over the exploration of oil and gas resources in the
sea that separates the country with Australia -- known as the
Timor gap.