Vannessa Hearman – East Timor's 2006 Human Development Report prepared by the United Nations Development Program and the Timorese government shows the country is suffering from deep structural poverty. The report argues for "integrated rural development" to be initiated by public investment as the "path out of poverty".

The key findings of the report include that:

• East Timor has the lowest standard of living in the region.
• Life expectancy in 2004 was 55.5 years.
• 60% of the population does not have access to adequate sanitation facilities.
• Half of the population does not have access to safe drinking water.
• Diseases to which the population is at risk from include tuberculosis, leprosy and diarrhoeal and respiratory illnesses.
• Only 50% of the population is literate.

The report shows that there is income disparity between the urban and rural areas in East Timor. Poverty is particularly severe for those with less education who are engaged in agriculture and for vulnerable categories such as war widows and orphans.

The report found that there is significant discrimination against women in areas such as education and employment. Half of women in intimate relationships reported being victims of some form of violence. Maternal mortality rates are as high as 800 per 100,000 live births.

In the rural areas, 64% of the population still suffers from food insecurity, or lack of access to food due to poor production methods, seasonal factors and crop failure.

Problems in agriculture have been compounded by the lack of infrastructure. The report points out that while having a "reasonable network of principal roads", secondary and access roads are barely existent and many areas are cut off during the wet season. Electricity supplies and telecommunications hardly reach areas outside of the capital, Dili. In some rural areas, access to the erratic electricity supply falls to only 10% of households. Both electricity and telecommunications are run by private, foreign companies.

The solutions to poverty recommended by the report focus on jump-starting the agricultural sector. The report acknowledges that the government has avoided key economic activities in this sector, "in the expectation that the private sector will move in to fill the gaps". Yet as this "waiting" has proven fruitless, the HDR urges massive public investment in the agricultural sector.

The Timorese government's agricultural policies have been drafted in line with advice from international financial institutions that have been integrally involved in the country's reconstruction. Institutions such as the World Bank, the International Monetary Fund and the Asian Development Bank have provided policy advice to the Timorese government in all sectors of the economy. In agriculture (largely the World Bank's area) and infrastructure (the ADB's area), public-private partnerships have been advocated and public provision has been discouraged.

According to Sydney University political economist Tim Anderson, the World Bank has rejected a number of Timorese government proposals for setting up public facilities, such as abattoirs and grain processing mills. The Human Development Report highlights the price that the Timorese have had to pay for the economic orthodoxy of these institutions.

The HDR also recommends the mobilisation of local networks and organisations in the agricultural sector, including farmers' organisations and cooperatives. The HDR recommends cooperatives in production and marketing, as well as transport to carry produce to the market. In 1975, Fretilin experimented with rural cooperatives. Cooperatives also existed under Indonesian rule, though were often used as a method of control. Local networks around the clandestine pro-independence movement and the National Council for Timorese Resistance flourished, but these were not utilised effectively to mobilise or resource the population after independence.

The role of cooperatives is recognised in East Timor's constitution. Progressive organisations like the Socialist Party of Timor recognised the value of cooperatives, which it set up in 1999-2000 in rural areas around Dili, Liquica and Manatuto to encourage the sharing of resources and produce among farmers. With precious little land, equipment and inputs among individual farmers, cooperatives are one way of sharing resources, but significant government funding is needed to provide seed grants in the first place to increase the farmers' resources.

Any expansion in agriculture must first tackle the issue of food insecurity, rather than to prepare East Timor for cash crop cultivation.

To meet the costs of public investment, the HDR identifies Timor Sea oil and gas revenues as key, in the face of declining international donor support for the country. Oil and gas revenues are expected to cover more than half of the public investment needed to tackle poverty. Yet Australia has unilaterally profited out of disputed oilfields. The Timor-based aid monitoring organisation La'o Hamutuk estimates that based on "very conservative calculations", Australia received "at least $2.2 billion in government revenues from Laminaria-Corallina [field] through the end of 2005".

On January 12, East Timor and Australia signed a new treaty that promises greater revenue to East Timor from the Greater Sunrise oilfield, in exchange for East Timor not campaigning for a change to the maritime boundaries between the two countries. East Timor, the region's poorest country, has ceded much of its desperately needed revenues to Australia, a wealthy imperialist country on its doorstep. Clearly East Timor has been the loser in this agreement.

While East Timor struggles to provide basic health care, with only 45 doctors in the whole country, socialist Cuba has contributed 60 doctors, as well as up to 600 medical scholarships, dwarfing Australia's official scholarship program. Two-hundred Timorese have already begun studying medicine in Cuba. This is an example of the kind of solidarity East Timor needs today.

[A copy of the East Timor Human Development Report 2006 is available from .]