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UN exodus pinches East Timor economy

Agence France Presse - November 25, 2012

Mouzinho Lopes de Araujo – East Timor is readying to stand on its own feet as international forces withdraw by the year-end. But for some in the 10-year-old nation, one of the poorest in Asia, the exodus also comes at a steep price.

The bars and restaurants on "the avenida" that runs along the coast of the capital Dili are now lonely haunts with the odd NGO worker or energy company representative dropping in.

The nightly roar of helicopters on patrol has subsided, while the UN's four-wheel drives that once packed the Avenida are replaced by old sedans and ramshackle yellow taxis looking to pick up Timorese for a $2 flat rate.

"Not many UN people come to our bar and restaurant anymore," Dili Beach Hotel manager Domi Riu told AFP. The bar-restaurant alone used to take in $2,000 a day, but since peacekeepers began withdrawing in large numbers last month, it is lucky to make $500.

Sixteen UN workers once occupied the hotel's most expensive rooms, between $700 and $1,500 a month, but today only five rooms are filled and the hotel may be empty by December 31, when all 1,200 peacekeepers will have returned home. "We have three options: cut the number of staff, cut their hours or go out of business," Riu said.

On Saturday, Portugal withdrew the bulk of its police, may of whom employed drivers and maids who will have to find new jobs. Some 850 Timorese UN staff and around 1,300 security guards will also be dismissed, according to the UN.

The UN said it was running a training program that involved more than 90 percent of its employees and it hoped the mission had given local staff an opportunity for professional development.

"We see pretty good prospects for our professional officers, who have really advanced their skills and experience here," the UN mission's chief of staff Gary Gray said.

"It may be a little more problematic for what you might call the unskilled part of the labour force – the cleaners, the drivers and the security guards. It's going to be a lot tougher for them."

Francisco Moniz, who has been working as a driver for the UN since 2000, said he was looking for work and expected to make less than the $570 monthly salary he has become accustomed to.

"The money I get from the UN is enough for our daily needs, including paying for my children's school fees," the 40-year-old with four children said. "But I'm happy that our country is trying to develop. East Timor is stable now so it's a good thing the UN is leaving."

The UN entered the territory after violence broke out in 1999 following the resounding "yes" vote for independence from neighbouring Indonesia.

Unemployment is 18.4 percent, according to the CIA World Factbook, but the percentage of young Timorese without a job is more than 40 percent, AusAID reported recently.

While industries that cater to foreigners will be hardest hit – from bars and hotels to high-end real estate – the overall economy in real terms will be little affected. The UN reports its mission contributed around $40 million to GDP of around $1 billion last year.

The impoverished half-island nation has bigger economic hurdles to leap, chiefly how to wean the nation off the energy reserves that have fattened its GDP and government coffers in recent years but are fast depleting.

Almost half of East Timor's population of 1.1 million lives below the poverty line, the World Bank reports, and the nation grapples with widespread malnutrition and high maternal and child mortality rates.

But many in the half-island nation that celebrated a decade of formal independence this year feel ready to take back the reins to combat the social woes that are hindering development.

"It's time for the Timorese people to govern ourselves and not depend on the UN," said Riu, the Dili Beach Hotel manager. "We want to show the world that we can lead ourselves."