Timor-Leste Success

Why It Won't be the Next Failed State

By Agio Pereira*

The headline of Madhu Narasimhan’s recent piece (“The World’s Youngest Failed State,” August 12, 2014) is dramatic, but his assertion is unfounded and untrue. Over the years, more than a few armchair critics have prognosticated the demise of the Democratic Republic of Timor-Leste, also affectionately known as East Timor. But nation builders do not indulge notions of failure.

Just 12 years old, Timor-Leste, which emerged from 24 years of brutal occupation and four centuries of colonial exploitation, is at peace. It has a stable, democratically elected government, and it is in the process of economic development. Timor-Leste has the fastest-growing economy in the Pacific, with an 11.5 percent five-year compound annual growth, according to 2014 figures from the Washington-based Heritage Foundation. In 2014, the United Nations raised Timor-Leste from a “Low Human Development Country” to a “Medium Human Development Country” in its Human Development Report, alongside South Africa, India, and Indonesia. In the past decade, more than 2,000 schools have been built and rehabilitated across the country, and life expectancy has risen to 68 years, an increase of 11 years since independence. In just nine years, Timor-Leste’s sovereign wealth fund has grown to $16.6 billion, and prudent management has yielded higher returns. By almost any measure, these are not manifestations of doom. Like any developing nation, Timor-Leste faces many challenges. But is it a failed state? Certainly not.

A WEALTH OF RESOURCES

Timor-Leste is blessed with natural resources that give it the means to develop. We in the country’s government do not take these gifts for granted, nor do we assume that Timor-Leste’s oil and gas will last forever. But to cast a pall over the entire country, proclaiming that the end is nigh just as Timor-Leste makes progress in building itself up, is vicious and counterproductive. Pronouncements that Timor-Leste is imminently running out of oil and time are ill informed and illogical.

In fact, off Timor-Leste’s southern coast, in the Tasi Mane (the Timor Sea), are rich hydrocarbon reserves that Timor-Leste is tapping alongside Australia. It is estimated that the Timor Sea will yield an additional $60 billion in goods and services. Timor-Leste has begun the multiyear Tasi Mane Project to further develop its domestic petroleum industry and eventually generate hundreds of thousands of valuable jobs.

The Tasi Mane Project includes the construction of a supply base, refinery, and natural gas liquefaction plant, as well as a seaport and three regional airports, the first of which will be ready in 2016. The project will establish a 100-mile corridor along Timor-Leste’s southern coast, complete with infrastructure for transportation, water, and electricity. This in turn will open up 2,500 acres of hinterland suitable for such industries as livestock farming, horticulture, forestry, and processing and packing exports. In other words: economic diversification.

And let’s not forget Timor-Leste’s onshore oil potential. Across the southern coast are at least 20 known oil sites. Timor-Leste will be releasing onshore acreage for drilling for the first time in an upcoming bid round slated for late 2014 or early 2015.

THE WAY FORWARD

Few new countries blessed with oil and gas would be already taking steps to avert the so-called resource curse. But in 2010, Timor-Leste outlined a 20-year Strategic Development Plan that includes policies and programs, currently under way, to diversify by building up agriculture and tourism.

Much of Timor-Leste’s vast agricultural lands have remained untainted by pesticides and chemical fertilizers, which means that the country is poised to produce high-quality organic fruits and vegetables for a premium export market. As the country is surrounded by water, it is also in the process of developing fisheries, aquaculture, and related industries. In fact, international consumers are already enjoying tuna harvested in Timor-Leste’s waters through fishing licenses granted to Chinese and Korean firms. Food security is another priority. Improved cultivation methods put Timor-Leste on track to self-sufficiency in rice production by 2020.

As for tourism, visitors to Timor-Leste need no convincing of the magnificence of our assets. We are developing an environmentally sustainable tourism industry that respects the culture and heritage of local communities. We want our children and guests to enjoy the natural beauty of Timor-Leste for generations to come.

Of course, there is much work to be done first. Land titles must be clarified, for example, lest the state be accused of illegally appropriating land for water dams and other irrigation systems necessary for agriculture. Investors require the security of such legal assurance. This process has been ongoing, and the government is now preparing to pass a land law to govern the zoning and conveyance of land.

Aside from irrigation, other infrastructure -- roads, electricity, sanitation, health care, and telecommunications -- is necessary to support both agriculture and tourism. The development of this infrastructure is under way. Of course, progress is slow initially as the government must first write the appropriate laws and build the requisite capacity.

The 20-year Strategic Development Plan includes policies that will give every Timorese child access to high-quality primary education by 2030; provide every family access to medical services, water, and sanitation; build a network of roads and bridges to connect the country; increase the capacity of the international airport; and, by 2020, ensure the whole country has access to reliable and affordable high-speed Internet.

One point raised by Narasimhan is sound, however: a permanent maritime boundary must be delimited between Timor-Leste and Australia in the Timor Sea, in adherence to the UN Convention on the Law of the Sea. No honorable country can legitimately deprive another of this most basic sovereign right. Timor-Leste stands ready to accept the adjudication of any international court and to abide by its ruling. We invite our partner and neighbor Australia to come to the table, in good faith, to draw the line.

Rome was not built in a day or even in 12 years. Those who remember the history of their own countries should be less hasty to issue premature judgment of another.

Building a nation is among the most worthwhile of human endeavors. It is not just a job, but a calling -- and a commitment. In the face of setbacks and disappointments, leaders have two choices: to throw in the towel or to press forward. For those of us who have already sacrificed everything, spending our entire adult lives fighting for a place to call home, there is really only one

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http://www.foreignaffairs.com/articles/141938/agio-pereira/timor-leste-success