Rebuilding Dependence

A Comparison Between East Timor and Iraq

by Ed Hollants

Dissident Voice

April 12, 2003


How will the reconstruction of Iraq work out/proceed? It could be instructive to look at the way reconstruction went ahead in East Timor, which I had occasion to visit five times between 1999 and 2002. The first time as an independent monitor during the plebiscite which led to independence, and afterwards to help establish an independent Timorese human rights group. Different as the situation in the two countries may be, there are a number of similarities between East Timor and Iraq that are worth considering:


* There is a large group of refugees in Western countries who will be returning, bringing financial capital and contacts;


* There is an interim government, formed by people from outside the country, which is intended to lead to the construction of a state headed by a democratic government after the Western model;


* There has been widespread destruction and reconstruction by foreign companies.


* And last but not least, in both cases there is a strategic interest for the US. In the case of Iraq this is quite clear. But we must not forget that East Timor is situated on the outskirts of the Indonesian archipelago, which houses the largest Muslim population in the world and which can be expected to take a less western course in the future. A future military base on East Timor may then be an option. And of course, oil plays an important role in both cases.


In East Timor, the UN, in the form of UNTAET (United Nations Transitional Administration in East Timor) during a period of over two years de facto took over the government of East Timor and the UN played a substantial role in the reconstruction effort. The US had a major finger in the pie, not just through the UN, but also by means of USAID, the largest financial governmental donor (US development aid), the IMF and the World Bank. Among other things, they forcefully introduced the US dollar as the national currency. Apart from the US, Australia was a major influence. They supplied most of the troops for maintaining public security.


Returning Refugees


One of the things that quickly began to cause tension in East Timor was the return of those East Timorese who had earlier fled the Indonesian occupation and who had gone on to build their fortunes, mainly in Australia. A number of these Timorese not only have financial resources, but also good contacts in Australia and the know-how to deal with the (capitalist) way of doing business of Australian companies. They are the ones who, in close cooperation wit the Australian companies, benefit most from the reconstruction effort. Hotels, shops and restaurants are being rebuilt and restored at a rapid pace, mainly to provide the many UN employees with the standard of luxury they seem unable to do without. The same phenomenon can be detected in the newly established political structures, which will feature even more strongly in the case of Iraq, where the opposition from abroad will in all likelihood play an important part, mainly due to pressure from the Pentagon. I refer to the Iraqi National Congress, led by Chalabi. He has good contacts with the American Vice-President Dick Cheney and Secretary of Defence Paul Wolfowitz, two leading ultra-conservative hawks. He further maintains close relations with the oil lobby and apparently also with the leading pro-Israeli lobby group AIPAC. All in all the INC has received funds to a value of 97 million dollar from the American government. While the native population still needs to recover from the acts of violence and years of oppression, these ‘refugees’ return to seize their opportunity.


Interim Government


All aid is clearly intended to form a state according to our Western model as quickly as possible, rather than let autonomous developments rooted in the people’s own history and experience take their course. Both East Timor and Iraq have never known a democratic state.  A state which predominantly ensures a free reign for (foreign) enterprise, prevents radical alternatives and suppresses rebelliousness. Everything is organised from above. Capable people are increasingly drawn into what is in fact a model that was forced upon them, making them dependent. Confronted with dire emergencies and the absence of viable alternatives (the foreign administration keeps coming up with given facts, preconditions and time limits), it becomes increasingly difficult to mark time. People are made co-responsible for decisions which are not easily explained to the people, thus forming a political elite. Community initiatives rarely get a chance, as the population has no access to the necessary funds or gets caught up in the wheels of government.


Foreign Enterprise


Foreign enterprise is accommodated in every way. At Dili airport in East Timor one could see planes full of businessmen and fortune seekers arriving, their only aim being to get rich as quickly as possible. Construction companies in East Timor are almost exclusively foreign-based, operating with mostly non-Timorese staff. Even Indonesian companies, with Indonesian employees, are setting up shop in East Timor. This phenomenon helps create an economy within an economy, a fact which also showed clearly in the case of countries such as Cambodia, which also came under UN rule after the country had been torn apart. This results in company turnover and profits immediately leaving the country, mostly untaxed. The same goes for a substantial part of the aid funds, as these moneys are to a large extent spent on wages for the interim bureaucrats, aid workers and foreign military staff. But East Timor also witnessed large tracts of land being bought up, which were likely to yield a profit in the near future, for example in the proximity of the airport, or land in locations likely to become tourist havens and coffee plantations. Should foreign investors encounter preconditions being set, they simply use a Timorese middleman. In the legal vacuum of such transition periods the cards for the future are quickly shuffled. The Timor Sea, which in part belongs to East Timor, is full of oil.


Meanwhile contracts have been agreed which entitle Australia to 60 percent of total revenue. Vital infrastructure also passes into foreign hands. Both the mobile and fixed telephone networks in Dili were set up by the Australian telephone company Telstra, commissioned by the Australian army. They made millions of dollars, without any durable investment in East Timor. This is bound to be even more the case in Iraq. Already contracts have been agreed for the

reconstruction of the oil installations and construction companies such as Halliburton, of which Dick Cheney was CEO for five years and is still a major shareholder.


New Dependence


The Timorese, like the Iraqi’s currently on the US, looked upon the UN more as an occupying force than as its liberators. From the start, the East Timorese were not happy with their arrival. This resulted in them taking an impassive and indifferent stance. With the UN operating from the viewpoint that they would have to ‘teach’ the Timorese what democracy entails and how to rebuild the country, there is virtually no cooperation. The Timorese are biding their time until the UN leaves. In the mean time, a political and economic tier has been formed which is incorporated into the ‘democratic’ capitalist system and which has very little affinity with the needs and desires of the Timorese people. Apparently the US is so influential that East


Timor, not withstanding its recent history, was one of the first countries to sign a bilateral agreement with the US to sideline the International Criminal Court. They also agreed a Status of Forces Agreement (SOFA) with the US on 1 October 2002. The SOFA pertains to US military personnel. They are given the same status as US embassy staff to which the 1961 Vienna Convention for diplomatic relations applies. This effectively grants military forces in East Timor diplomatic immunity. They are exempt from tax legislation, contract rules and criminal law. The East Timorese authorities forfeit the right to take them to court, imprison them, expel them, search their premises, call upon them as witnesses or hold them responsible for children fathered with Timorese women. Iraq had better be prepared!


East Timor is totally dependent on foreign capital and investment and has been forced onto the globalised markets. Thus it has immediately forfeited its hard-won independence which has cost hundreds of thousands of people their lives. This automatically results in the larger part of the population losing faith in a new and better future, which increases the mood that it is ‘every man for himself’. Many Timorese are disillusioned. In many ways they are no better off, if not worse, than under the Indonesian occupation. Under Indonesian occupation they could still cherish the prospect of liberation and independence. Now they have lost track and it may be a long time before they get back on it. Which is precisely what the US favour, both in the case of East Timor as of Iraq. The aim is to incorporate these countries in the so-called free world market, where they have no means of competing, given the existing political and economic balance of power. In this way these countries effectively lose control over commodities such as their oil. And that is what is behind the so-called democratisation of the Middle-East.


Ed Hollants is a member of the Autonoom Centrum in the Netherlands, an independent radical politcal centre active on issues like migration, globalization, the Middle East, and radical democracy (www.autonoomcentrum.nl/). He can be contacted at: ac@autonoomcentrum.nl




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