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Sovereignty could hinge on coffee crop

Washington Post - February 20, 1999

Atika Shubert, Dili – Civil war, 23 years of Indonesian military occupation and more than 300 years of Portuguese colonialism have bequeathed an unexpected boon to the tiny territory of East Timor, and one that may be the key to its hotly debated independence: some of the world's most sought after coffee beans.

Indonesia abruptly announced this month that it would consider cutting East Timor loose as early as next year.

But the viability of any future independence may hang on the territory's prospects for economic self-sufficiency, and that, in turn, will be based largely on coffee, its primary export.

While years of political strife have devastated the population of this half-island nestled in the eastern wing of the Indonesian archipelago, armed conflict has shielded East Timor's rich coffee fields from the intrusion of modern pesticides and fertilizers because those areas have been inaccessible.

As a result, East Timor's certified organic coffee is sold for as much as 40 percent more than other Arabica beans, according to the Association of Indonesian Coffee Exporters.

Furthermore, East Timor's unique volcanic soil and ideal altitude provide for a full-bodied coffee coveted by connoisseurs of gourmet blends.

According to East Timor's former governor and head of agricultural development, Mario Carascalao, the region's coffee production could provide as much as 50 percent of East Timor's current budget of approximately $100 million, becoming the cornerstone of its economic autonomy.

"In the event of independence, I believe East Timor will experience difficulties for two to three years. But rehabilitation of our coffee plantations could result in profits of up to $50 million," Carascalao said.

Such are the high hopes placed on the humble Hibrido de Timor coffee bean, which is generating almost as much anticipation as the high-level talks next month on East Timor's political future among Indonesia, the United Nations and Portugal, the UN-recognized administrator of the territory.

Indonesia invaded East Timor in December 1975, replacing many of the Portuguese-run export businesses with Indonesia's military-controlled equivalents.

Portuguese colonialists earned a considerable profit from Timor's coffee mainly by keeping wages low and imposing a strict monopoly, but failed to develop the territory's other natural resources.

In 1991, Indonesia's Timor Gap treaty with Australia went into effect, projecting profits of as much as $ 2.2 billion for oil extraction from East Timor's seabed.

Although Indonesia has yet to decide what will happen to the contract if independence becomes a reality, independence activists already have made plans to appropriate Timor Gap profits for their own use.

In addition to hiding guerrilla separatists, East Timor's rolling hills also hold marble quarries "for every color in the rainbow," said one dealer, making the territory a potential supplier to Australia, Indonesia and its Asian neighbors.

Tourism also has the potential to be a big money earner. Investors already have approached East Timorese officials on the prospect of making the predominantly Roman Catholic territory a gambling haven for Indonesia's rich and famous in the midst of the world's largest Islamic country, where gambling is illegal.

Former governor Carascalao said he knows just the right place for a casino where guests can sunbathe on pristine beaches, sip afternoon tea on lush hilltops and gamble the night away after a meal of grilled lobster and Portuguese wine. "Why would you go to Monte Carlo if you had all that right here?" Carascalao asked with wide smile.

However, East Timor still faces many obstacles. Violence between pro-integration and pro-independence groups is on the rise, scaring away investors and directing foreign aid to more immediate humanitarian concerns.

Oscar Lima, an East Timorese real estate developer, abandoned his luxury hotel project located on East Timor's northern shore of white sand and untouched coral reef. "No one wants to come here knowing civil war could break out any day," he noted.

The territory also faces a labor shortage. Human rights groups estimate that 100,000 people – one out of every three East Timorese – may have been killed by armed conflict, starvation or disease as a result of the ongoing violence.

To build up its industries, East Timor's small population of 800,000 may have to import labor – ironically from its closest neighbor and occupying power, Indonesia. All of this, however, hinges on the success of East Timor's biggest money earner.

If coffee can be used as a base for East Timor's other industries, Carascalao said, than the tiny territory may have a shot at independence and economic self-sufficiency.

Real-estate developer Oscar Lima is already selling off prime pieces of Timorese beachfront to invest in coffee plantations. "It's the one sure thing," he said.

Carascalao couldn't agree more. Inviting guests into his home, he serves diminutive cups of strong East Timorese coffee and offers refill after refill.

After taking a deep whiff of the coffee's aroma, he said, "It's a taste we hope the whole world will get to know a lot better in the future."