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Address to forum hosted by Marion Hobbs in association with
Asia 2000 Foundation, Institute of Policy tudies, Centre for Strategic
Studies and New Zealand Institute for International Affairs, New
Zealand Parliament Buildings, Wellington, New Zealand, 18 August
2003
Ladies and Gentlemen, Honorable Marion Hobbs;
Thank you for inviting me to share with you my thoughts on Nation
Building and International Development. The essential tasks of
nation building, economic reconstruction and consolidation of
democratic government remain key challenges for my country, the
Democratic Republic of Timor-Leste.
After a year of independence, although security remains one of
our biggest issues, we are a nation in the process of successfully
building a democratic and sovereign state. We are in the process
of establishing effective systems and structures, strengthening
administration at all levels, and promoting democratic and transparent
governance. We recognise that success will only come with good
governance and that is why we have been focussing in the last
year on creating an institutional culture, by setting up structures
and institutions to assist decision making processes in all arms
of government.
Strong institutional culture and good governance can only be
achieved through accountability and transparency in all levels
of Government and the public sector. However, to achieve this
it is essential that our people are properly armed with the skills
required. Assistance from the international community in education,
employment and training of Timor-Leste nationals has been key
in helping Timor-Leste achieve this objective.
The government is an integral part of the democratic system that
we are all building. This system includes other state powers,
legislative and judiciary and entails fundamental principles that
will sustain a democratic system no matter who is in power.
I can not envisage democratic power without the periodic renewal
of mandates by means of democratic elections, without a free media,
without guaranteeing the fundamental rights of citizens, without
an independent and efficient judiciary, without a strong, conscious
and participatory civil society and without responsible opposition.
Our Government has achieved much in its first year in power.
In terms of international development, we have seen Timor-Leste's
accession to the United Nations, the accession to the Group of
African, Caribbean, Pacific States, accession to the Cotonou Agreement
which is a partnership agreement between the ACP and the EU with
such 'objectives as poverty eradication, sustainable development
and the gradual integration of the ACP countries into the world
economy", establishment of observer status with the Pacific
Islands Forum and Association of South East Asian Nations and
our accession to CPLP, the Community of Portuguese Speaking Countries.
One of our key achievements has been the establishment of a National
Development Plan. This was created through consultation with thousands
of people across the country, civil society and key members of
the community. Our plan considers the development of education,
health, agriculture and infrastructure as priorities for our future.
Another success is our active open governance. Without adequate
infrastructure by which our local media can disseminate information
to the communities, our solution has been for the Council of Ministers
to participate in interactive dialogue with local people throughout
the districts. This helps us to govern transparently and to involve
the people of Timor-Leste in this critical phase of nation building.
We want to ensure that we consider and include the aspirations,
and concerns of the people. To support this open governance program,
a key element will be the establishment of a Government Information
Office once resources and funding become available.
Economically, the biggest achievement in our first year of independence
has been securing revenue from oil and gas deposits in the Timor
Sea. The Timor Sea Treaty was ratified by both Australia and Timor-Leste
earlier this year after tough negotiations. As a temporary joint
development agreement with Australia, the revenues from the first
development, the Bayu-Undan development, will give Timor-Leste
a chance to establish some degree of financial independence. An
estimated three billion US dollars over the next 17-20 years will
be earned by Timor-Leste from this project. This money will be
spent on such priorities as education, health, agriculture and
infrastructure.
Further to our dedication to good governance, we recognise the
need for government accountability for economic and financial
management. Now that we are approaching the time when the Bayu-Undan
project begins production the Government intends to establish
a framework for sound management of petroleum revenues over the
long term. We have a responsibility to present and future generations
to use this wealth wisely.
A Petroluem Fund is no substitute for sound fiscal management.
It can, however, support sound fiscal management if it has wide
political and popular support, clear rules and stores genuine
savings by the Government. We therefore intend to set up a Fund
and have sought advice on international best practice that we
can adapt to our needs from the IMF, World Bank and ADB.
Our Fund will be integrated into the budget process. Fund assets
will be prudently managed and invested offshore. The rules and
operations of the fund will be transparent with stringent mechanisms
to ensure accountability and prevent misuse. At the same time
our Fund will maintain the sovereignty of Parliament over revenue-raising
and spending decisions.
We have learned from the experience of our friends in Norway
and the model we shall adopt might be called "Norway Plus".
Very simply, the Fund will receive all our petroleum revenues
and build up a balance that earns income. Withdrawals from the
Fund will meet the difference between our spending and our non-petroleum
revenues. The "plus" in Timor-Leste will be, firstly,
a guideline that only the sustainable income from our petroleum
wealth can be spent and, secondly, a range of accountability mechanisms
including an independent Fund Council to oversee the operations
of the Fund.
For transparency, we shall publish what goes into the Fund and
publish what is taken out. Its accounts will be independently
audited. We want the people to Timor-Leste and the rest of the
world to know that this nation can make good use of its oil and
gas wealth as it is extracted from the Timor-Sea.
Through our savings plan and prudent and transparent management
of funds, the prioritisation of development in essential areas
such as the alleviation of poverty, education, health, infrastructure,
agriculture and security; the dedication to capacity building
Timorese people and the dedication to sustainable trade and economic
development, I believe the Timor-Leste Government is demonstrating
a good understanding of what the essential principles of good
governance are in order that the benefits of this crucial period
of nation building are durable and long lasting.
The success of the Timor-Leste Governments objectives, I believe
lies in effective communication with the people to educate them
on the issues of nation building and to make sure they have a
realistic understanding of what it will take to get our country
where we want it to be, and the continued establishment of international
best practice in all areas of development, tailored to the needs
of Timor-Leste.
Through already well established international relations, world
wide support of Timor-Leste, expert advice on best practice in
all arms of nation building and a determined and ambitious people,
I envisage a prosperous future for Timor-Leste.
Thank you for your attention.
I will be happy to respond to any questions you may have.
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