Lindsay Murdoch in Dili and agencies – About 20 youths attacked the Dili Club, a restaurant-bar owned by an Australian and popular with foreigners, roughing up patrons before United Nations police arrived. No one was seriously injured.
Security alerts sent to foreigners in the East Timorese capital yesterday warned that gangs were roaming the streets looking for Australians. Embassies last night issued warnings that foreigners were likely to be targeted and that their citizens should not leave their homes after nightfall.
UN police arrested 15 people in 24 hours for violent offences. They also dispersed 500 people trying to protest outside the fortified Australian embassy.
In an attempt to stop the sharply escalating violence, the East Timorese President, Xanana Gusmao, last night increased the powers of security forces.
In a televised address to the nation, Mr Gusmao announced that Australian and New Zealand soldiers and UN police now had sweeping additional powers, including stopping and searching anyone and entering homes.
The sudden increase in security powers came after the former prime minister Mari Alkatiri blamed Australian soldiers for failing to capture the rebel leader Alfredo Reinado because they did not ask local people for help.
Mr Alkatiri said he had advised the Australians when they surrounded Reinado and up to 150 heavily armed men in the mountain town of Same last week that they would need the support of locals to capture him.
"Timorese know the terrain much better than the Australians," Mr Alkatiri said. "But they did not ask for co-operation from the locals."
The Australian Foreign Affairs Minister, Alexander Downer, said in Jakarta yesterday that the Government was planning to evacuate Australian embassy staff and their families who wanted to leave. Mr Downer said he had authorised the voluntary departure for non-emergency staff from the embassy.
"The deteriorating security situation in East Timor is a matter of serious concern to the Australian Government," Mr Downer said. "The security situation is volatile and there is a high risk of violent civil unrest. There is an increasing likelihood that Australians could be specifically targeted."
After the failed attack by Australian soldiers on Sunday, Reinado fled further into the central mountains. In a 90-minute gun battle, Australian troops killed four of his men. The Australian troops used night vision equipment and were backed by helicopters and armoured carriers.
Since leading a mass escape last August from Dili's main jail, where he was being held on murder and rebellion charges, Reinado, a former major in the Timorese army, has used the media to taunt and mock the Australian and other security forces trying to capture him. But he has not contacted any journalists since the attack.
The commander of Australia's 800-strong contingent in Timor, Mal Rerden, declined to comment yesterday on what he referred to on Sunday as an "ongoing operation" to capture Reinado.
Mr Downer said he did not want East Timor's most wanted man killed – just caught. "That is the challenge for us, not to kill him," he said.