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Should East Timor join ASEAN?

By Dionisio Da Cruz Pereira - posted Wednesday, 25 May 2011


Unlike the European Union where most of its members share a lot of common feature s– politically, socially and culturally, ASEAN member countries are more apprehensive towards each other. The preamble to the ASEAN charter clearly states that “respecting the fundamental importance of amity and cooperation, and the principles of sovereignty, equality, territorial integrity, non-interference, consensus and unity in diversity.” That suggests that any member country should refrain from criticizing the internal affairs of every member country.

Second East Timor’s major infrastructure such as public transports, communication, financial institutions and other government services remain underdeveloped. These problems will further undermine the country’s ability to improve its global competitiveness and attract foreign direct investment which is vital for economic growth. All of these problems have been highlighted in the recent United Nations Development Reports in 2011.

Today 90 percent of the state’s budget is funded by oil revenues. On the contrary, most non-oil sectors such as forestry, fishery, agriculture, tourism and others have not been properly developed. Almost all essential goods - building materials, food items, clothing, medicines and others - are imported from overseas. The over reliance on imported goods has pushed prices up, creating the so called “Dutch disease” syndrome.

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Right now investment law and other trade arrangements remain weak or even non-existent. One immediate consequence of this will be that East Timor might become a dumping ground for cheap goods from other ASEAN member countries. This has been a major problem for many emerging economies where governments are unable to control the operation of market forces.

Economically East Timor has not produced manufactured goods which would allow the country to engage in trade with other member countries of ASEAN. Though East Timor is famous for its organic coffee, the coffee production is considered minuscule and has not generated massive revenue to the country. Lack of support to engage farmers in productive farming activities has reduced the country’s ability to engage in major exporting activity.

Third, some suggest that East-Timor’s ascension to ASEAN will bring positive outcomes for the country. Nonetheless, it must be noted that right now ASEAN is pushing towards stabilizing the so called ASEAN Economic Community (AEC) 2015, aiming at creating economic integration in the region by 2015. This economic integration suggests that all ASEAN member states will give up some of its political, social and cultural rights. These include relaxation of trade restrictions, movement of goods and services as well as people.

While some will argue that such a move would be positive for economic development, it would also generate a number of problems including increased human trafficking, money laundering, illegal drug trading, environmental issues or even international terrorism. A survey carried out by the Alola foundation in 2004 revealed that human trafficking has been a major problem in East Timor since gaining independence. Human traffickers used sophisticated networks and empty promise s such as promising well-paid jobs in other countries to lure victims. Though the government has taken some efforts to address the issue, poverty and unemployment provide a breeding ground for such recruitment.

Last the increased number of foreign nationals is another issue. Since 2002, there has been a large influx of foreign nationals - Chinese, Indias, Indonesian, Philippino, Vietnamese and others – coming to do business in East Timor despite sometimes being only on tourist visas. Some foreign nationals even appropriate lands in the country even though such practices are forbidden under the East Timor constitution. Almost all well-paid construction work in East Timor have been monopolized by foreign workers leaving the East Timorese to do the underpaid works. These problems will continue to pose challenges to the country if not properly addressed.

If East Timor is serious about joining ASEAN, it must address these challenges. Failure to do so will further undermine East Timor’s future economic development programme. ASEAN membership will provide solutions to all the problems currently being faced.

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Perhaps East Timor should learn from the fact that presently some European countries like Norway, Switzerland, Iceland and many others have never been part of the European Union, and yet these countries have developed sophisticated trade agreements with most UE members which in turn bring mutual economic benefits. Therefore, instead of rushing to join ASEAN, East Timor should ask itself what membership of ASEAN would actually achieve for it.

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About the Author

Dionisio Da Cruz Pereira is pursuing an M.Sc in International Development at the University of Birmingham, United Kingdom.

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