[Easttimorstudies] Ramos Horta and Helen Hill on Radio National

[Jennifer Drysdale]

Transcript of an interview with Ramos Horta and 
Helen Hill (Victoria University) on Radio 
National (Geraldine Doogue) last Saturday morning.

Transcript can be found at 
http://www.abc.net.au/rn/talks/saturday/stories/s1609955.htm

podcast url: http://www.abc.net.au/rn/podcast/feeds/satextra.xml
podcast: Entire program, weekly, selected 
interviews updating Saturdays at 11am. [NB: this interview is at the beginning]
Anticipated File size:18MB

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Timor-Leste

It’s been four years since Timor-Leste, formerly 
known as East Timor, gained full independence 
from Indonesia. And according to a recent World 
Bank assessment in Dili, this tiny nation of 1 
million inhabitants is one of the only 
post-conflict countries that has been able to 
maintain peace and stability during that period.

But so far this stability has not translated into 
an economic one. But how do you build a nation's economy from scratch?


Transcript

Geraldine Doogue: Now there’s a really forbidding 
list around at the moment from a new United 
Nations report, cataloguing all the things that 
are not thriving in post-independent East Timor, 
which is just celebrating its fourth birthday. 
They range from poor life expectancy to high 
illiteracy rates to high infant mortality rates, and so on.

But there’s another list as well, of less 
tangible measurements, that’s available, which is 
related to the relatively peaceful climate that’s 
quite rare in countries that have been torn by 
war, and occupation, as Timor has experienced for 
30 years. And that bad dispute with us, 
Australia, over how royalties from big developed 
and potential oil and gas fields would be used, 
that has now been settled. Revenue is set to grow 
to maybe $280-million this coming year, up from $80-million.

So where does the verdict come down on the fate 
of East Timor? You be the judge.

On this Easter weekend, we thought we’d invite 
two people to join us to have a bit of a good 
conversation on how best to encourage this new 
nation-state to thrive, not just to survive. And 
I’d like to welcome now the Foreign Minister, Dr 
Jose Ramos Horta, well known to Australians, and 
also from Melbourne, Dr Helen Hill, from the 
School of Social Sciences at Victoria University, 
and also the author of an upcoming book on Timor-Leste. Welcome to you both.

Helen Hill: Thank you, Geraldine.

Jose Ramos Horta: Thank you, Geraldine.

Geraldine Doogue: Minister, you’ve just had the 
Development Partners Conference in Dili, or the 
‘Donors’ conference to shorten it, looking at the 
steps taken so far to develop the county. What 
would you say were the key outcomes from those talks?

Jose Ramos Horta: Well I would say that we are 
all very proud of the fact that the Donors 
unanimously, and that includes the World Bank and 
the IMF, the International Monetary Fund, praise 
our government performance in the last four 
years, since the transfer of sovereignty. And 
contrary to obviously what the media usually 
pick, they pick on the difficulties or the 
failings, the reality is that if we can make an 
assessment, an evaluation of four years, much has 
been achieved. Maybe not enough to compensate for 
the growing population, because we have a 
population growth of almost 4%, the highest in 
the world, but at the same time the number of 
children enrolled in schools, the number of 
students going to universities here in 
Timor-Leste and abroad, the number of water 
supply delivery to people, electricity, or 
communications like telephones, today we have a 
mobile connection and land connection from that 
chain almost every district and sub-district, the 
first time ever in the history of this country.

Of course we do have still daunting challenges to 
reduce or eliminate poverty altogether, and we 
are conscious of that, and because of that, the 
government for this fiscal year, 2006-2007, our 
budget is now $230-million plus roughly 
$100-million of Donors support, we have at our 
disposal $330-million to invest across the board 
including in infrastructure development, like 
roads and bridges that will create thousands of jobs this year and next year.

Geraldine Doogue: Tell me, you spent so many 
years going around the world trying to secure 
East Timor’s independence. Now that you are in 
government, what has been for you the most 
surprising thing about that transition that you 
weren’t expecting? What’s been hardest?

Jose Ramos Horta: Well definitely the most 
difficult challenge
and that is the lack of 
qualified, trained, experienced people in the 
government who can make decisions and implement 
the decision when they’re made, to execute the 
programs, the budget, that is available to them. 
We cannot complain, we do not have a lack of 
money. But until we have experience, qualified, 
hardworking people in the administration who can 
expeditiously, efficiently execute the budget, no 
matter how much money we allocate for 
development, for infrastructure development, we 
will continue to face problems. Problems in that 
money that has been allocated to a particular 
sector has not been spent, or wisely spent.

Geraldine Doogue: And is there a fast track way you can improve personnel?

Jose Ramos Horta: Yes, we have had a number of 
capacity building programs carried out with the 
help of the UN or bilaterally by countries, we 
are hiring international advisers to assist 
through the World Bank or through the United 
Nations system but also we are conscious that 
because now we’re going to invest substantial 
amounts of money in infrastructure development 
such as roads and bridges, in smaller schools; 
every year we will build about 100 new schools. 
Well we will need to open the tender process to 
international contractors. And they, the 
international contractors should be able to bring 
in foreign workers so that they’re able to 
execute their projects in a timely and 
professional fashion. As long as, obviously, they 
would hire a percentage of Timorese workers, 50% 
Timorese workers, and to the extent possible, 
involve a local partner. But involving of local 
partners is not compulsory, we can have an 
entirely foreign company operating as long as 
they train our people and use local workers.

So we hope that through this process we can have 
a more efficient and a timely completion of tasks or projects.
Geraldine Doogue: Dr Jose Ramos Horta:, the 
Minister for Foreign Affairs and Co-operation in 
Timor Leste, speaking to us, and maybe I could 
draw in Dr Helen Hill: here. Dr Hill is senior 
lecturer at Victoria University and passionately 
interested in East Timor. What sort of report 
card would you give this newly-emerging country, Dr Hill?

Helen Hill: Well I think in many ways it’s been 
quite exemplary, particularly in wanting to keep 
its hands on the steering wheel you could say, of 
its own economic direction, which many small 
countries I think, get overwhelmed by and almost 
give up on, and I think the general outline of 
policymaking and the way that the Timorese 
government has been able to negotiate with its 
Donors, including Australia over the Timor Sea 
oil and gas, and with the World Bank over whether 
or not to take loans, has been quite exemplary, 
because they do have a philosophy and an 
understanding of how they would like to see the country develop.

But I think on the other hand, there’s been a bit 
of a tendency to be dragged into the discourse 
which sees the money as the main thing, and as 
the Minister rightly said, our problem now is not 
the money, it’s actually human resource 
development. And I think that it was a pity that 
particularly during the years when the UN was 
there, that there wasn’t more done on actually 
reorienting the education system away from being 
a small remote province of Indonesia, to where 
people could, when they graduate, go and get jobs 
in Indonesia, to a small country which now the 
people have to be multiskilled. The education 
system, particularly the higher education system, 
is training people at too high a level of 
specialisation whereas what is really needed is a 
lot of people at the middle level with some 
academic skills, some organising skills, ability 
to implement and also to be very multiskilled, 
particularly in agriculture and food processing, 
food preservation and thinking about creation of markets.

Geraldine Doogue: It’s a form of really clever, 
utterly clever bureaucracy, isn’t it, that then 
empowers others. I mean you’re talking about 
very, very good leadership. Can you think of 
anyone who could offer that? Have you seen 
providers who can offer that sort of assistance? 
Should we be doing more on that front?
Helen Hill: I have seen in New Caledonia a rural 
education system called the Maison Familiale 
Rurale, which teaches people straight out of 
junior high school, on their own farms, how to 
grow crops, but teaches them science as well. It 
amalgamates the academic and the practical 
knowledge, and one of the things I notice in 
Timor which is a bit sad in a way, is that the 
education system in a sense is dragging people 
out of the productive economy, because once 
people reach a certain level of high school in 
Timor, they more or less say to – their family 
says to them ‘You don’t need to come and do any 
more work on the farm. You’re going to be an 
urban worker.’ And skills that they may even have 
had when they were young, they lose. And this 
happens in many other countries too, of course, Timor’s not the only country.
Geraldine Doogue: This is a rural-city divide really.
Helen Hill: It is, and it’s the way that because 
education came in as a colonial thing which was 
to create an elite most people it was assumed 
would fail and drop out, and then the elite would 
be there at the top. Now it’s my observation that 
a lot of agriculture in Timor at the moment is 
actually done by people who’ve failed in the 
formal schooling system. And therefore can’t read 
and write. And therefore are not a good basis for 
the improving the productivity of agriculture 
without a very different sort of training.

Geraldine Doogue: So do you agree with that Dr Ramos Horta?

Jose Ramos Horta: Yes, generally, yes. For 
instance our national university has something 
like 8,000 students, and quite a lot of them are 
in the area of Humanities, and quite a lot of 
them are in a particular degree that was invented 
by the Indonesian side, and is almost useless, 
and they call it Social Politics. Well I don’t 
know exactly what one does with that course. In 
my own ministry I have already said, no-one with 
that degree will be allowed into the Foreign Ministry.
Geraldine Doogue: You’ve decided that, have you?
Jose Ramos Horta: Yes, I’ve decided that as 
warning to students, Don’t pick this course. But 
of course we have now technical college emerging 
as private ones. There had been some older 
technical colleges, institutions that have been 
started in this country going back to the ‘60s 
that have trained people in agriculture, in 
electricity and so on. The government is now 
determined to support vocational schools. Even 
though right now, we have a significant 
unemployment level, we believe that in the next 
few years, as we develop the country with 
hundreds of millions of dollars of investments, 
we are now going to start talks with the Kuwait 
fund, as well as with China for very soft loans 
to Timor, which coupled with our own revenues, we 
will be able in the next ten years to transform the country.

Geraldine Doogue: Let me ask you if you wouldn’t 
mind me asking this – can a viable economy that 
is not in effect a rent-seeking economy, or 
relying on welfare from others, can a viable economy be created in Timor Leste?

Jose Ramos Horta: Absolutely. Obviously, 
precisely because the government has made as one 
of its key goals, is to reduce, eliminate poverty 
in ten years from now, according to the United 
Nations established human development goals. And 
to do that, we have to invest seriously in, for 
instances, infrastructure like roads, if we want 
to develop our agriculture, we have to improve 
the roads and bridges, so that farmers can bring 
their goods to the cities, to the markets and so 
on, so that students can have an easier access to 
the schools. So there is no way around one thing, 
and that is we need the roads, we need better 
telecommunications, and that can be achieved only through massive investment.

Geraldine Doogue: Well of course the Chinese are 
putting an enormous amount of precisely this type 
of money into the Laotian and the Myanmar and the 
Thai economies, to build these huge highways 
linking north and south Asia, and East and West 
Asia, so I mean, there’s the prototype for you.

Jose Ramos Horta: Well I wouldn’t know whether 
that is a prototype for us. Our plan, which has 
been helped by different expat groups including 
from India, on how to improve our road network, 
that is based on our own understanding of the 
needs of the country. But at the same time, these 
will create thousands of jobs, and that means 
money that we’ve injected into the pockets of 
families, in the economy and so we believe, I 
believe, that in five, ten years from now, you 
will see unemployment significantly reduced, you 
will see poverty significantly reduced. All of 
this obviously with a big question mark in the 
context of having to be able to produce people 
with experience, with the proper degrees, but 
also in conditions of peace and stability in the country.

Geraldine Doogue: I’ve just to ask you: what if 
Indonesians want to come in and take up some of 
these jobs? Are they going to be the sort of people whom you will welcome?

Jose Ramos Horta: We do not have a policy of 
discriminating against any particular country. 
The law states very clearly that companies 
investing here, companies that will win the bid 
for building roads and other infrastructures, 
will be able to bring up to 50% of labour in case 
we do not have it here. And if they are to be 
Indonesians, they are most welcome. We have the 
best possible relationship with Indonesia, but 
also we are happy to welcome from any other 
country, if they are needed as I said earlier, to 
execute the projects in an efficient, 
professional, timely fashion. The government’s 
considering hiring companies that will supervise 
and monitor projects. We will not tolerate 
companies that have won a particular bid to build 
a road and then they fake and they’re dishonest, 
and introduce a very poor quality result. We are 
having a very, this problem here, with a 
particular foreign company, of course the project 
was paid for by their own country, one major 
country in Asia to build some roads, and my Prime 
Minister simply refused to inaugurate that road because it was poor quality.

Geraldine Doogue: Let’s just go to a couple of 
specific areas, Helen Hill:, that I know that 
you’ve looked at. Coffee, a very important crop 
for the Timorese, and a great deal of work needs 
to be done to revive it. I think it’s the third 
most significant legally traded commodity around 
the world after oil. Now might it be best developed in Timor, do you say?

Helen Hill: Yes, I think it’s interesting to note 
that the Timorese learnt a lot about the 
international oil marketing in doing their 
negotiations with the Australians, and that 
probably an equivalent amount of work needs to be 
done to get on top of how exactly it is that the 
Timorese can make the most out of their coffee 
crop, because several things had happened over 
the period of the occupation, and during most of 
the occupation, the Indonesian Generals were 
actually making a lot of money out of that 
coffee, and it was the NCBA, the National 
Co-operative Business Association, coming in from 
the United States and providing a bit of 
competition, which actually led to the Timorese 
getting a better price for a period of time for 
that coffee. But unfortunately, I think what 
appears now to be happening is that there is not 
really a free market in who the Timorese can sell 
their coffee to, because the overwhelming 
majority of it goes to this one buyer, and the 
other thing, if you compare it with other small 
countries that produce coffee, and the one I went 
to last year and was very surprised to see, was 
Norfolk Island, where they actually roast and 
produce all their coffee on the island, and only 
allow it out of the country as finely processed packets of coffee.

Geraldine Doogue: So they do the secondary processing as well.

Helen Hill: They do the whole thing, and the 
processing of coffee is a relatively simple 
technology. It’s the marketing that’s the 
difficult thing, and because of commodity chains, 
now what is happening is the primary producer who 
grows the actual crop gets a much smaller 
percentage of what people pay. I mean in 
Brunswick Street, Fitzroy, we pay say nearly $30 
for a kilo of Timorese coffee. Now the Timorese 
grower gets about one of those, and all the rest 
of it goes to other producers and suppliers along the commodity chain.

Geraldine Doogue: You haven’t mentioned the word 
‘Starbucks’, Helen Hill:, I was waiting for you. 
It’s a bit of a bum word, isn’t it. Because isn’t 
in fact Starbucks - in effect the Americans 
control the National Co-operative Business 
Association of the USA, which is heavily - and 
Starbucks buys two-thirds of that coffee, doesn’t it?

Helen Hill: Starbucks is able to get a huge 
amount of the Timorese coffee, partly through the 
activity of the NCBA which also runs clinics. So 
the Timorese who produce the coffee are enticed 
to sell their coffee to NCBA in order to be able 
to use the clinics. It creates a whole sort of environment.

Geraldine Doogue: What sort of clinics?

Helen Hill: Medical clinics. But of course 
they’re now less needed, because the Timorese 
Ministry of Health has built a lot of clinics, 
and is beginning to provide a good service.

Geraldine Doogue: Now I think Ramos Horta, you 
supported, didn’t you, this – why? What sort of 
benefits would you say that co-operation has delivered the Timorese?

Jose Ramos Horta: Well going back to the past, 
during the Indonesian time, it was important to 
have some independent entity that would break the 
monopoly on the coffee by the Indonesian 
military. And I have to say over the years, this 
was tremendously helpful to the Timorese farmers. 
Now of course, our Ministry of Agriculture, our 
government is looking at ways. First we have to 
renovate the coffee plantations. Our coffee 
plantations are old. In the course of 24 years of 
Indonesian occupation there was no new planting. 
The coffee was left, up and gone. And now we have 
to look at, and the government is already working 
with support from Brazil and scientists from 
Australia and the US looking at ways to renovate 
not only the coffee trees, but also the trees 
that provide shade to our coffee. Our coffee is 
unique in the world, in that it does not have 
fertilizers. All the generations it produced a 
very special flavour, a very special taste, 
because of the soil and because of the shade 
provided by these gigantic trees. But these 
trees, in themselves, lately have been targeted 
by a particular fungus. So now we are struggling 
how to attack this fungus that can destroy the trees that provide the shade.

Geraldine Doogue: You’re such a good salesman 
Jose Ramos Horta:, truly you are, I can almost 
taste this coffee. But look, can I just move on 
to one more example, because I’m afraid we’re 
running out of time. What about banks? This is 
another very basic, filthy lucre and all that. 
Your banking system was essentially destroyed 
wasn’t it, after independence, and a lot of 
people lost their savings. Now there’s a real 
sense that you need a rural development bank, you 
need the capacity to allow people to transfer 
money, even from Dili to the provinces.

Now Helen, before I come to you for a final 
remark, Helen Hill:, how important is this rather basic need?

Helen Hill: Look I think this is really basic. 
One of the things that I’m always amused by: 
economists’ way of talking about creating wealth 
is that almost none of them seem to mention the 
need for the two important things to create 
markets, are communications, ability to get money 
around the place, and a transport system to get 
the goods about the place. And all three of these 
were sadly destroyed by the Indonesians and in a 
sense ignored in the UNTAET period. There is no 
cheap, easy place for, as there was under the 
Indonesians actually, a Post Office savings bank. 
And there is in most Pacific Island countries, 
people can go to the local Post Office and send 
money to their relatives around the countryside. 
There is a phone system and there are discussions 
about prices so that the creation of markets 
requires an awareness that you need a Parcel Post 
system based on a Post Office, that goes to all 
the districts. You need money to be able to be 
transferred, such as through the Post Office 
bank, and then you need a good phone and radio 
system. You need wider knowledge of people so 
that they can get a feeling for the nature of the market in various products.

Geraldine Doogue: I’ll give you the final word Dr 
Jose Ramos Horta:, by way of summary. What do you 
think is the top priority in all that we’ve 
talked about, so that we can see a difference in ten years time?

Jose Ramos Horta: Well if I were to talk on the 
basis of what our government program is for the 
next five, ten years. It is a very, very 
ambitious one, and I believe it is do-able. And 
that is massive investment in infrastructure 
development, in education, in health, benefiting 
from the oil and gas revenues from Bayu-Undan as 
well as from development assistance, as well as 
from some new possibilities of assistance from 
the United States. Because of a very good 
performance on our side, the US so-called 
millennium challenge account, this is a very 
innovative far-reaching program that was 
established by the Bush Administration to assist 
countries in transition, countries who had good 
governance, respect for human rights and 
democracy, to get out of poverty. So Timor Leste 
is now fully eligible to this account, which we 
can obtain up to $300-million in the next two 
years from the United States to develop the 
country. So in all of this, I believe that in the 
next five, ten years, in conditions of peace and 
stability, we will see this country radically 
transformed from today one of the poorest in the 
world, to I believe one that will be modestly 
prosperous, where you will see much, much less 
poverty, much, much less malnutrition, much less 
illiteracy and much less malaria, dengue and so 
on. And I’m very optimistic, and I’m not saying 
this as a government official doing propaganda, 
but I’m very independent-minded as you know, and 
I’m optimistic from what I see my government 
doing and from what I observe in the country so far.

Geraldine Doogue: Well look, we all wish you 
luck. thank you very much indeed. I think there 
are all sorts of facts there that none of us in 
this country knew readily, so Dr Jose Ramos 
Horta, thank you for joining us from Timor.

Jose Ramos Horta: Thank you, Geraldine, it’s very kind of you.

Geraldine Doogue: And Dr Helen Hill from the 
School of Social Sciences at Victoria University, 
thank you very much for joining us too.

Helen Hill: Thank you, Geraldine.


Guests on this program:

Dr Jose Ramos-Horta
Minister for Foreign Affairs and Co-operation
Timor-Leste

Dr Helen Hill
Senior lecturer
School of Sociology
Victoria University



Story Producer: Dai Le