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East Timor's economic future is its past - farming

Source
Deutsche Presse Agentur - August 29, 2001

Joe Cochrane, Ermera – The farmers of Ermera are fiercely proud of their long tradition of growing East Timor's finest coffee, but these days that is not enough to fill their stomaches.

This pristine, sleepy mountain town is the largest coffee producing region in the territory, but there are few visible signs of its prosperous past. Men, women and children sit quietly on street corners lining crumbling roads, killing time ahead of a second harvest of coffee beans.

This summer's other harvest of prime arabica beans was good, but world coffee prices have slumped, and Ermera's residents have no other viable cash crop and few paying jobs. So they sit and wait for their soon-to-be independent nation to develop in the hopes that it will bring them higher coffee prices, as well as occasional menial side jobs building new roads and schools.

"We cannot just wait for coffee," said farmer Jose da Costa Babo, 28, who said he earns half the price for his unprocessed beans than he did during last few years of Indonesia's occupation of East Timor. "We also need to do other jobs."

In many ways, Ermera's residents are symbolic of the huge task East Timor's forthing government will have in creating jobs for its 800,000 people, half of which are of adult working age. Around 80 per cent of the population are subsistence farmers, ekeing out a living by selling cash crops such as coffee and eating whatever else they grow.

But the euphoria of the territory's 1999 independence vote from Indonesia, and the arrival of the UN and international agencies to set up a multi-party election scheduled for Thursday has given many Timorese false expectations about what life will be like with democracy.

"People were equating the [1999] election to getting jobs, and the economy gets better," said Johanna Kao of the International Republican Institute, a US-funded democracy building group. "It's going to be a lot of hard work and there hasn't been discussion on how much hard work it's going to be."

The arrival of 10,000 foreign UN peacekeepers, police and civilian personnel has further muddied the waters. The foreigners have high salaries, live in nice houses, drive expensive cars and eat at Western-style restaurants.

The vast majority of Timorese live on about one dollar a day, and enviously dream of office jobs, cars and houses to replace what was destroyed by departing Indonesian soldiers and pro-Jakarta militias after the 1999 ballot.

"If it is not easy to get a job, it's possible people will get angry and cause problems," said 73-year-old Sedaliza Santos, who has lived under occupation by Portugal, Japan and Indonesia. "There may be no economic activity." There were already several riots earlier this year, mainly by unemployed youths throwing rocks at UN offices and police, as well as occassional attacks on expatriate workers.

Reality now appears to be setting in about the limited prospects for East Timor's economy after independence, tentatively slated for March of next year. When that happens, the UN mission, the territory's largest employer of Timorese, will pull out along with its so-called "bubble economy."

East Timor political leaders, the UN, World Bank and other agencies have been discussing for months how to build a balanced, sustainable local economy from coffee production, massive off-shore oil and gas deposits, as well as tourism and light industry.

"Agriculture is a very, very important part of it," said Natacha Meden of the World Bank mission in Dili, the territory's capital.

That means the vast majority of the population will continue with subsistence farming, and new jobs from foreign investment such as garment factories, which flock to developing nations, will be some years away.

The international community has pumped around 550 million dollars into East Timor during the past two years, much of which has been used for reconstruction, building infrastructure, agricultural projects and loans to small businesses.

"In terms of attracting manufacturing plants, it will probably take a little while because of the competition in the region, Meden said, "and wages are so much higher here because of the UN presence."

The UN Transitional Administration in East Timor has a budget of only 65 million dollars to run the government, but its massive presence has attracted wildcat businesses that strictly cater to the expatriates.

Some foreign businessmen are convinced that the economy will collapse after the UN pulls out, saying many foreign-owned businesses that employ Timorese would follow. "Without the UN here to run the economy, there is no economy," said one Australian.

Not so, said Brazilian Sergio Vieira de Mello, the UN mission chief. He said many UN and international agencies would remain in East Timor indefinately after independence, thus providing jobs, and that Western and Asian donors were committed to long-term development assistance. "I don't think there will be any implosion," he said.

De Mello better be right for the sake of da Costa Babo and his fellow coffee farmers in Ermera. Until development and jobs can come to their town and give them an alternative income to farming, their very survival will be at the mercy of world markets.

"If there is to be other development, it is the responsibility of the government," da Costa Babo said. "For us, we see only coffee."

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