A tough act to follow – The Edge Review/RTÉ World Report

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http://www.rte.ie/radio1/world-report/programmes/2015/0315/687205-world-report-sunday-15-march-2015/

A father and son look for seashells along Dili Harbor. (Simon Roughneen)

DILI – In February, the much-anticipated end of an era in Timorese politics finally arrived. Xanana Gusmao, the charismatic and outspoken prime minister, resigned and handed over to Rui Maria de Araujo from Fretilin, the main opposition party.

Nearly two decades younger than Gusmao, Araujo follows a man with a formidable legacy. Gusmao’s career spans four decades, from leading a guerrilla war against Indonesia to seven years in prison in Jakarta to a triumphant homecoming after East Timor voted to leave Indonesia in 1999 and then building the foundations of his fledgling country.

Gusmao was elected to the ceremonial presidency of Timor-Leste, as the newly-independent state was formally called, and later became prime minister in 2007. Under Gusmao’s lead, the economy grew at double-digit figures due to oil and gas revenues. He spent heavily on infrastructure contracts, increasing electricity supply to around 60 per cent of the population and ordering road-building and repairs nationwide.

Araujo may be from a different party to Gusmao, whose National Congress for Timorese Reconstruction (CNRT) remains the biggest in the government, but in an interview with The Edge Review he insisted he would change little. “In terms of overall governing program, we are not shifting too much from the previous government, as this is a continuation,” Araujo said.

But Gusmao’s administration was tarnished with corruption allegations against two of his highest-profile ministers. And despite eye-popping growth, oil and gas extraction have not generated jobs for the hundreds of thousands of Timorese who eke out a living as subsistence farmers or are jobless.

Moreover, the oil and gas revenue that comprises around three-quarters of GDP will run out in around a decade, meaning an urgent need to develop other sectors of the economy.

Nor does Araujo have long to implement his policies, as elections are due in 2017.

Tourism and agriculture will be two priority areas, he said: “At least we could set some foundation for the next government to follow on these.”

The prospect of East Timor becoming an 11th ASEAN nation could also boost the economy, he added. “It is an open door to diversify our economy and get access to other markets.”

Keeping the peace may prove another challenge. Gusmao became prime minister only a year after 2006 fighting in Dili between army and police factions. One of these groups later tried to assassinate Gusmao and President Jose Ramos Horta, a Nobel peace laureate.

It could have been worse. Gusmao’s style helped kept a lid on tensions, suggests After the Buffaloes Clash, a new study of East Timor by the London-based Overseas Development Institute (ODI).

His election “signalled a shift in how politics was conducted” in East Timor, with increased deference to Gusmao’s leadership and “a growing elite consensus on policy goals”, the ODI said.

Gusmao’s willingness to spend – little more than patronage, some argue – “helped control tensions within and between the police and military and incentivised politicians to limit contestation.”

In his second term, won in 2012, Gusmao reached out to Fretilin, which is led by Mari Alkatiri, independent East Timor’s first prime minister. Fretilin had bitterly disputed Gusmao’s win in 2007 – no surprise, given that a year earlier Gusmao, as supposedly ceremonial president, had forced Alkatiri to resign as prime minister as Dili burned.

Now, though, East Timor’s two biggest parties have effectively formed a national unity government, dispensing with real parliamentary opposition. “During the discussions of the government program there were no party rivalries in that discussion, and the discussions of the Budget reflected that,” Araujo said.

But there are hints that Prime Minister Araujo will, perhaps cautiously, change some aspects of how East Timor Inc. is run. He lamented, for example, that some roads built and repaired under Gusmao are still under par, and said services such as health and education need extra money.

Government spending must be the main driver of growth until a viable non-oil private sector grows up. “Economic stability and fiscal sustainability will depend on the quality of this investment; as well as the success in transforming public economic activity to private activity, and petroleum to non-petroleum development,” warned Bolormaa Amgaabazar, the World Bank’s East Timor representative.

Araujo promised to aim for “efficient and economical use of the public funds,” perhaps suggesting that he did not share Gusmao’s penchant for handing out lucrative road contracts to unqualified veterans of the independence war.

Amid concerns that his successor could struggle to control local rivalries, Gusmao is staying on in government in the seemingly personalised new portfolio of Minister of Planning and Strategic Investment. He thus retains a hand on the purse strings – and the award of lucrative contracts.

“It will be difficult for Prime Minister Rui Araujo to make significant changes to national and rural contracting decisions now presided over by [Gusmao] prior to the next elections,” said Sarah Dewhurst, co-author of After the Buffaloes Clash. “He will likely focus on higher-level political and economic issues as well as improving the provision of social services.

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