EAST TIMOR: The International Monetary Fund pledged its support yesterday for a national development plan for the new country of Timor Leste.
East Timor will be handed its independence next weekend by the UN Secretary-General, Mr Kofi Annan, at a ceremony to be attended by representatives from 80 countries.
An international donors' conference in the parliament chamber in the Timorese capital will today pledge aid expected to meet a $25 million shortfall in its $77-million budget for the first year. At the conference yesterday the main author of the plan, Dr John Taylor, professor of politics at South Bank University, London, said: "They will cough up."
Timor Leste is asking the international community to save it from beginning life in debt.
Ireland has yet to decide on its contribution but it will be "significant", according to the head of the Ireland Aid mission in Dili, Ms Fionnuala Gilsenan. Ireland has already given $500,000 towards East Timor's Consolidated Fund.
The new government is asking donors to bridge a budgetary gap of $25 million a year until its oil revenues come on stream in 2004. Ms Gilsenan said one reason why donors were looking favourably on Timor's request was that the new country was seen as "a green field site", in the sense that the national plan had the scope for new policy direction and embodied "best practice".
She said the plan intended "to avoid a cyclical poverty trap characteristic of many African countries".
The plan, launched yesterday by the future prime minister, Mr Mari Alkatari, is indeed visionary. It prioritises poverty reduction and "economic development that improves human values".
An IMF statement to the donor conference, attended by delegates from 27 countries and multilateral agencies including the Asian Development Bank and the European Commission, said the plan's three-year budget "merits support". It said, however, that "eliminating impediments to investment must remain a priority" and urged that wages, "well above those in neighbouring countries", be allowed to "adjust downwards".
Although 41 per cent of people live on 55 cents a day, in the capital the presence of thousands of foreigners has caused inflation. The currency is the US dollar. The IMF confirmed that 90 per cent of business is in dollars. It's just one of life's contradictions in the new Timor.
Meanwhile, an old Timor hand, Mr James Dunn, called for the resolution of another contradiction. A former Australian diplomat, he is the author of a UN report which found that 23 Indonesian officers were responsible for the atrocities, including killings, destruction and massive depopulation, that followed East Timor's 1999 vote for independence. He wants an international commission to investigate those events.