[TimorLesteStudies] Thesis: Petroleum Revenue Management in
jenster at cres10.anu.edu.au
Mon Oct 8 14:30:38 EST 2007
My apologies to anyone who has tried to access the thesis today - it
is now available.
Please start by accessing this web-page:
I have inserted further information about each of the chapters, as follows:
Drysdale, J. (2007). Sustainable development or resource cursed? An
exploration of Timor-Leste's institutional choices. PhD Thesis,
Australian National University, Canberra, Australia.*
The thesis is divided into two parts. The first part explores the
academic and grey literature, and is dedicated to understanding the
problem of the resource curse and its potential and relevance to
Timor-Leste. Part Two is dedicated to the explanation and results of
the empirical component of this research. You can download the thesis
in its entirety. But I encourage you to save a few trees by reading
it on your computer, or alternatively print the chapters you think
will be useful to you separately:
This document includes the Acknowledgments, Abstract (also provided
in full at the bottom of this web-page), Acronyms, Non-English Terms,
Lists of Figures and the Table of Contents.
Introduction - This chapter provides an outline of the thesis (and
each of the chapters), the research questions, the scope of the
thesis, and the research contribution.
PART ONE - HATENE LO'LOOS (KNOW WELL)
The Challenges of Managing Natural Resource Wealth - This chapter
provides an exploration of the challenges of managing natural
resource wealth. The literature on the resource curse is reviewed and
the relationship between institutions and resource revenue management
is discussed. Throughout the evaluation a framework for understanding
that relationship is developed. This framework distinguishes three
possible outcomes when a state exploits its natural resource wealth;
a state is either cursed, resource cursed, or enables sustainable
development. Social and human capital (the 'two caps') are
fundamental to institutional quality, and therefore fundamental to
the outcome under this framework. Thus, the empirical component of
the research is designed cognisant of the need to enhance
participation in making decisions about petroleum revenue management.
Timor-Leste's Institutional Landscape - This chapter describes
Timor-Leste's institutional landscape in terms of the framework
developed in Chapter Two. Timor-Leste's history is central to an
understanding of its institutions today, and the state of its
institutions today provide an indication of the potential outcomes of
Timor-Leste's natural resource revenue boom. This chapter also
provides an overview of Timor-Leste's potential petroleum wealth and
illustrates the enormity of its contribution to the future of
Timor-Leste as a sustainable state.
Managing Timor-Leste's Petroleum Revenue - This chapter describes the
Government of Timor-Leste's plans for managing its petroleum revenue.
The Petroleum Fund Law is central to the Government's plans but it is
not the only institution responsible for managing petroleum revenue.
Managing Timor-Leste's petroleum revenue includes saving, spending
and monitoring it. Thus, petroleum revenue management in Timor-Leste
is everyone's responsibility; the President, the Parliament, the
Bureaucracy, the Courts, and civil society. This chapter provides a
comprehensive analysis of the details of the Petroleum Fund Law and
other mechanisms that govern the management of petroleum revenue.
PART TWO - HATENE SAIDA MAK EMA NIAN HANOIN (GETTING TO KNOW WHAT
Research Design - This chapter explains the methods for both
collecting and analysing the data, and reflects on the efficacy of
the chosen methods. The data comes from 28 semi-structured interviews
(conducted in 2004) and 47 interviews (conducted in 2005) using
multi-criteria decision analysis software called 1000minds (then
called Point*Wizard). The methods were designed to elicit opinions
about key decisions in managing Timor-Leste's petroleum revenue. The
sample was designed to include decision-makers and people outside of
government, both East Timorese and foreign advisers. The objective
was to seek a broad range of opinions to broaden and illuminate the
discussion about petroleum revenue management in Timor-Leste. The
data is presented in three chapters which each focus on a different
aspect of petroleum revenue management.
Saving and Investing Timor-Leste's Petroleum Revenue - This chapter
explores how participants think Timor-Leste's petroleum revenue
should be saved and invested. Point*Wizard software was used to
generate a ranking of which aspects of saving and investing
Timor-Leste's petroleum revenue were most important to participants.
The method also generated discussion themes, which include choices
about Timor-Leste's revenue potential (in terms of whether the
Government uses its petroleum revenue or seeks international finance,
and how soon petroleum fields should be exploited), whether
expenditure of natural resource wealth is sustainable (in terms of
the amount that is withdrawn from the petroleum fund), and three
aspects of petroleum revenue investment (the level of risk, where
revenue is invested and in what currency).
Spending Timor-Leste's Petroleum Revenue - This chapter is concerned
with how participants think Timor-Leste's petroleum revenue should be
spent. The semi-structured interviews generated a vision for
Timor-Leste expressed by the participants and this, in turn, informed
the design of the Point*Wizard research which asked participants to
choose how petroleum revenue should be spent. One part of the
Point*Wizard research elicited a ranking of the choice between
spending on social services, infrastructure, individual payments and
consumable capital. Another component of the Point*Wizard research
asked participants to rank 14 budget sectors in terms of their
priority to increase budget expenditure. The results of the research
in this chapter provide an understanding of the links between sectors
in terms of budget priorities, and the ultimate goal of sustainable
Timor-Leste's Petroleum Pevenue Management Challenges - This chapter
draws the discussion throughout the thesis together. Further findings
from the field research underpin the basis of the framework from
Chapter Two. Participants' comments about Timor-Leste's institutions
and the themes of accountability and responsibility are discussed.
Social and human capital are essential to wise petroleum revenue
management and, ultimately, Timor-Leste's sustainable development.
This chapter explores the 'two caps' in terms of their role in
enhancing accountability and responsibility. Finally, this chapter
looks to the way forward for Timor-Leste and highlights three aspects
of petroleum revenue management that will require attention if
Timor-Leste is to avoid the resource curse.
Conclusion - This chapter concludes the thesis by highlighting the
contributions that the thesis has made to understanding the problem
of managing natural resource wealth in Timor-Leste.
<http://cres.anu.edu.au/~jenster/References.pdf>References A list of
the references referred to in the thesis
documents (including the Petroleum Fund Law and excerpts from
interviews) are referred to in the thesis
My PhD thesis explores the institutional choices available to
Timor-Leste to manage their natural resource wealth wisely and avoid
the resource curse. Timor-Leste is a poor country and its challenge
is to use its large per capita resource wealth to alleviate poverty
and enable sustainable development. This research examines the
Petroleum Fund Law, and other mechanisms to manage petroleum revenue
that the Government of Timor-Leste has established. These mechanisms
appear to be resilient, but remain untested. Based on field
interviews in Timor-Leste, the study offers insights into the
opinions of East Timorese and foreign advisers about how
Timor-Leste's petroleum revenue should be managed, and how a poor
country can raise the living standards of its people.
A framework that identifies human and social capital as essential to
the quality of institutions is developed in this research, which
proposes that the pre-condition of institutions affects the
management of natural resource revenue. As a result of history (not
its natural resource wealth) Timor-Leste's productive institutions
are weak and destructive institutions, such as corruption, are
strong. The preferences of the research participants, identified
using semi-structured interviews and multi-criteria decision
analysis, revealed that what petroleum revenue is spent on is the
most important petroleum revenue management decision. Further, health
and education were regarded the highest spending priorities.
Petroleum revenue management decisions that may affect Timor-Leste's
economic, social and political independence were also important to
Timor-Leste's sustainable development depends on continued assistance
in the form of foreign advisers to address its lack of human capital.
A commitment to transparency should counteract the lack of trust
between government and civil society. Timor-Leste will also need to
invest more in people, and recognise that the wise management of its
petroleum revenue depends as much on good governance as the
mechanisms designed to manage it. The people of Timor-Leste's fierce
determination to overcome the challenges they face, against all odds,
may help Timor-Leste to avoid the resource curse.
* Please include all reference details when quoting text or ideas
from this research.
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Email Jennifer.Drysdale at anu.edu.au
Personal Website http://cres.anu.edu.au/~jenster
East Timor Studies www.etstudies-aust.org
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