After emerging from a devastating 24-year Indonesian military occupation, East Timor will finally gain its official independence on May 20, 2002. It is an exciting time for the country, but as with so many impoverished nations scrambling to survive under corporate globalization, the struggle is entering a new phase with daunting challenges. As an East Timorese activist recently told participants at the World Social Forum in Porto Alegre, Brazil, "After a long struggle for independence, our nation is once again being controlled by outsiders."

Centuries of Portuguese colonial rule and 24 years of brutal Indonesian military occupation have left East Timor one of the poorest countries in the world. It is literally rebuilding itself from ashes: as the Indonesian military withdrew in September 1999, it destroyed 70% of the country's infrastructure. Tasked with an enormous reconstruction effort, the East Timorese government now expects a $154 to $184 million shortfall in its already lean recurrent and development budget over the first three years of independence.

East Timorese government leaders have joined grassroots activists in repeatedly stating that the country should not mortgage its future by incurring debt. Because the World Bank technically cannot give loans to non-self-governing territories, borrowing money has not yet been a possibility. But if the wealthy countries of the Global North do not commit enough support to carry East Timor through the initial years of its independence, the likelihood of the East Timorese government being coerced into taking out such loans will increase dramatically.

The East Timor Action Network (ETAN), Jubilee USA Network, the 50 Years is Enough Network, and other U.S. and international human rights groups are pushing international financial institutions (IFIs), the U.S. government, and other donor nations to support East Timor at this crucial stage in its development with grants rather than loans. The organizations are also insisting that East Timor not be saddled with the crippling "structural adjustment" conditions that have devastated so many other countries. The Bush administration has claimed it is committed to fighting global poverty, and for the last ten months has been pushing hard in international meetings for more international assistance to poor countries to be given in the form of grants [see Nicola Bullard's article on the front page for more detail on the potential dangers of that U.S. position]. The U.S. (and other industrialized countries) should go beyond this sweet-sounding rhetoric by guaranteeing "structural adjustment"-free grants to East Timor, thus avoiding the cycle of debt and poverty to which too many countries have been condemned.

The U.S. and other powerful governments actively aided Indonesia's genocidal occupation of East Timor with weapons, military training and political support. In the course of the occupation Washington provided more than $1 billion in military aid to the Indonesian government. Given this history, grants to East Timor should be seen as a form of reparations rather than "aid."

The economic agenda of the World Bank and kindred international institutions is not confined to loans. The Bank, in fact, has been managing grant funds and shaping major projects in East Timor over the past two years. The most recent edition of the La'o Hamutuk Bulletin (www.etan.org/lh), the excellent newsletter of the joint East Timorese-international project which monitors the UN and other international institutions in East Timor, examines a World Bank-designed program of for-profit "Pilot Agricultural Service Centers (PASCs). Although the program's stated goal is to rebuild agricultural capacity in a devastated country, the Bulletin notes that "PASCs are run as businesses because of the World Bank's explicit free-market policies. This compromises the PASCs' ability to assist the farmers; the farmers' needs are secondary to the PASC's objective of covering its costs and maintaining (or increasing) its profit margin."

In the same issue, East Timorese activist Eugenio Fatima Lemos writes that in evaluating World Bank programs which provide tractors, pesticides and chemical fertilizers to East Timorese farmers, "we must think carefully about our future agricultural system and how it can take into good consideration our culture, the condition of the land and water, as well as East Timor's climate and topography. This system must be sustainable. If not, we will quickly destroy our richest land, the quality of our water, and we will be dependent on others, a situation that has happened in many other countries in the world. If we are not careful with the resources we now have, our grandchildren may only know of the richness of our land from stories."

Indeed, recent East Timorese experiences with the international community have led many to question its supposedly good intentions. In a recent tour of the United States, East Timorese activist Filomena dos Reis, who works with the East Timorese NGO Forum and Fokupers (the Communication Forum for East Timorese Women), argued that the UN transitional authority in East Timor (UNTAET), which has been running East Timor since late 1999 with input from the East Timorese leadership, has done little to aid local people with long-term capacity building. Filomena did compliment the UN on some of its work, but stressed that internationals had brought far too many experts with questionable skills to East Timor, while allowing for only minimal grassroots participation.

Jarring disparities between international and local UN staff have helped establish a two-tier economy that benefits few East Timorese. International staff receive average monthly pay of $7,800, while United Nations "volunteers" are paid a monthly "modest living allowance" of $2,250 per person per month, in addition to transportation to and from East Timor and a settling-in allowance. Meanwhile, the average salary of a Timorese staff person is only $240 per month. Adding insult to injury, one Asian Development Bank "micro-finance" project primarily for rural women originally proposed extremely high interest rates, while also suggesting the World Bank pay four international consultants $150,000 per year each.

East Timor is in desperate need of real, people-centered development.

Unemployment is estimated at 80%, the annual per capita income is less than $300, average life expectancy is 48 years and the infant mortality rate is 135 per 1000 live births. Given the failure of neoliberalism to improve conditions for the poor elsewhere in the world, it is doubtful that the privatization and appeals to outside investment being encouraged by IFIs in East Timor will adequately address these problems.
The legacy of the nearly quarter-century long military occupation of East Timor includes widespread physical destruction, psychological trauma, an ongoing refugee crisis, and a need for healing and justice. With solidarity groups in other countries, the East Timor Action Network is continuing to campaign for a return of all refugees who were forcibly displaced to Indonesian-controlled West Timor in September 1999. ETAN and other solidarity groups, along with East Timorese NGOs, are also pushing for an international tribunal to bring to justice Indonesian military and government officials and militia commanders responsible for war crimes in East Timor. Given the continuing power of the Indonesian military, most knowledgeable observers see the "Ad Hoc Court" on 1999 atrocities in East Timor finally convened last month in Jakarta as likely to be little more than a whitewash.

In order for East Timor to achieve true independence, East Timorese and their international friends will need to keep their eyes on World Bank, IMF and ADB plans for East Timor. For now, those of us in the United States must maximize pressure on Congress and the Bush Administration to give the most generous grant possible, with no strings attached, at the mid-May international pledging conference in East Timor. Those in other countries should press their governments to do the same. There is absolutely no reason that the entire $154 to $184 million financing gap faced by the new country - miniscule in international terms - should not be covered in full. For more information on the International Campaign for a Debt-Free, Structural Adjustment-Free East Timor, or for details on ETAN's other campaigns, see ETAN's website (www.etan.org) or contact ETAN Field Organizer Diane Farsetta (diane@etan.org, 608-663-5431).