DATE=10/7/1999
TYPE=BACKGROUND REPORT
TITLE=EAST TIMOR ECONOMY
NUMBER=5-44433
BYLINE=AMY BICKERS
DATELINE=HONG KONG
INTERNET=YES
CONTENT=
VOICED AT:
INTRO: As peacekeepers try to secure East Timor from
pro-Indonesian militias and refugees trickle back to
their towns and villages, daunting challenges lie
ahead for East Timor. Among them, the rebuilding of
the territory's economy. Amy Bickers has more from
the V-O-A Asia News Center.
TEXT: East Timor is expected to become one of Asia's
smallest countries, as soon as Jakarta ratifies the
August referendum which showed overwhelming support
for independence.
It will be a state born in ruins. The burning,
looting and killing that followed the announcement of
the referendum's results destroyed many town and
villages. But community leaders and international aid
agencies are already thinking about how to create a
viable economy.
Chris Manning, an expert in East Timorese issues at
the Australian National University, says efforts will
center on the farming sector.
/// MANNING ACT ///
It is fundamentally an agricultural economy with
a large government sector. It has been fairly
dependent on Indonesian government transfers
over the years. I would imagine the economy and
the whole development effort will have to focus
on the agricultural sector. Coffee is an
important crop.
/// END ACT ///
Even though pro-Indonesia militias have destroyed much
of East Timor, its coffee crop is intact and is
expected to yield a bumper harvest this year.
Sandalwood and marble are other vital resources, as
are oil, gas and minerals that lie offshore. But
despite these commodities East Timor is impoverished,
with a per-capita income of about 400-dollars a year
before the humanitarian tragedy. That is one of the
lowest levels in Asia.
Economists say East Timor will have to rely on aid
from the international community for at least a
decade. Despite aid offers from numerous countries,
foreign investment is unlikely, since the territory
has no manufacturing base.
In the long term, analysts say that tourism could be a
potential revenue earner if the future micro-state can
draw visitors to see centuries-old fortresses and
churches left over from the Portuguese colonial era.
But for now, the economy is not even at a
subsistence level. Entire villages have been burned
to the ground and a substantial number of East Timor's
800-thousand people have lost all their possessions.
As the people of East Timor struggle to rebuild their
lives, the international community, along with East
Timorese leaders, are laying plans for economic
development.
Mr. Manning says many basic issues remain unresolved,
including what currency to circulate.
/// MANNING ACT ///
It is most unlikely East Timor will use the
Indonesian rupiah although there are some good
reasons why it might. I would think it would
take its own currency and peg it to the
Australian dollar or the U-S dollar or some
basket of currencies.
/// END ACT ///
The United Nations is leading the rebuilding plan,
with the help of the World Bank, International
Monetary Fund and others.
Recently aid donors met in Washington to discuss East
Timor, and pledged to provide support to begin
reconstruction and development assistance.
But even with all that help and advice, the people of
East Timor must build their nation from virtually
nothing.
NEB/AB/FC/KL
07-Oct-1999 07:33 AM EDT (07-Oct-1999 1133 UTC)
NNNN
Source: Voice of America
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