Can East Timor fulfill its Developmental Vision 2020?

The competition for housing can generate conflict amongst the residents and also with the state authority. City residents occupying government properties constantly face evictions from the government. This year, in the city suburb of Bairro-Pite, about 1000 squatters were forcibly evicted by the government without proper compensation (East Timor Law and Justice bulletin, 2009). The lack of a proper policy to address the compensation issue has left many residents in limbo.

In many rural villages, access to clean water, electricity, roads and income generation is still a major challenge. Most people rely on government subsidies and assistance from non-government organizations.  

Telecommunication is another issue. The World Bank (2007) noted that East Timor currently has the most expensive telecommunication costs in the world. Only five percent of citizens, most of them living in the capital, have access to basic telephone or data services. For those who can access the internet, it is costly and limited in capacity. Even though the network coverage has been improved across the country, accessing the internet and telephone are still too expensive for most people.

Besides problems in the agricultural sector, all basic manufactured commodities such as building materials and household consumables are imported from overseas.  The United Nations Food and Agricultural Organization (FAO) estimated that in 2007/08, East-Timor received 6000 tons of food aid annually, This has increased to 119,000 tons since the major food crisis hit in 2008.  

Heavy reliance on imports has increased the general inflation in Dili to 6.6 percent in the year to June - and with food costs inflating to around 8.5 percent over the same period (World Bank, 2010). Despite some improvement in the agricultural sector, production is not sufficient to feed the population. Many people living in rural areas constantly face malnutrition and hunger.

There are a number of factors that hamper the government’s efforts to address some of these challenges:

First, there is a lack of competent civil servants to plan, coordinate and implement the government programs - and most key positions are dominated by the members of the ruling coalition parties who are not selected on merit, but rather through party’s nomination.  

Furthermore, a reluctance to work in government leaves a shortage of knowledgeable workers there. The government then hires from overseas, people on exorbitant salaries. Most newly qualified East Timorese graduates seek jobs in foreign agencies - such as the United Nations, World Bank, AusAID, US Aid and others.

Second, there is major corruption.  Lack of effective supervision of government programs resulted in the misuse of funding.  Ninety percent of the budget is funded by oil revenues - and the 2011 state budget stands at over 1 billion American dollars. The government promises that the money will be particularly used to provide employment opportunities, education and training opportunities, continued cash transfers for the most vulnerable and increasing food security measures.

Though such increase is welcome, a failure to effectively control the budget would result in corruption and misappropriation due to a lack of transparency and accountability. So far the Commission of Anti-Corruption (CAC) has yet to prosecute any official charged with corruption.

 A draft United Nations Human Development Report 2010 criticized the government in many areas such as high youth unemployment, falling per capita incomes and increasing poverty rates in rural areas - despite increased government spending (Murdoch, 2011). Instead of working together with the United Nations, the government questioned the credibility of the data.  

After nearly ten years of independence, poverty is still pervasive throughout the country. Despite millions of dollars spent, many still have no access to electricity and basic health services. Travel for rural populations remains a challenge. Will East Timor be able to realize its vision 2020? It is feasible provided the government starts investing in its human capital.

Recently, the government has expressed interest in joining regional economic co-operations - such as the South East Asian Nations (ASEAN) and South Pacific Forum. By joining these regional co-operations, the hope is that the country can participate in a regional market - thus enabling East Timor to benefit from economies of scale and comparative advantage.

But, without prudent investment in human capital and infrastructure, East Timor will be unable to compete economically and politically with other regional member states.