Economic challenges cast shadow on 25th anniversary celebrations of Timor-Leste’s independence vote

As the tiny nation of Timor-Leste prepares to celebrate the 25th anniversary on Friday of its vote for independence from Indonesia, some Timorese say it is an apt occasion to reflect on whether freedom has improved their lives.

The festivities planned for Aug. 28 to 30, themed “Day of the Beloved People of Timor-Leste,” are tempered by the harsh realities of widespread poverty and economic challenges. 

Julio Tomas Pinto, Timor Leste’s former secretary of state for defense and now government adviser, told BenarNews that economic development, poverty eradication, and job creation are the country’s biggest challenges.

“People’s expectations for a better life are very high,” he said. “It is the government’s duty to make changes to meet these expectations.”

With United Nations data showing that around 40% of Timor-Leste’s 1.3 million people are still living below the poverty line, the question now is what comes from liberation from a colonizer, said Maria Olandina Alves, Timor-Leste’s ambassador to Vietnam and former pro-independence activist.

“The initial dream was to free the country and free the people,” she told RTTL, Timor-Leste’s national broadcaster. 

“Yes, our country is liberated, we have our flag, our national anthem, the four sovereign bodies … but the question is, are these people liberated?” 

Virgilio da Silva Guterres, Timor-Leste’s ombudsman for human rights and justice, echoed the former activist’s sentiment. 

“It’s been 25 years … it’s a day to ask introspective questions,” Guterres told BenarNews. “Did we prove to our people that independence is the best option … the perfect decision?”

The events the government has planned for the 25th anniversary of the vote on Friday, Aug. 30, include exhibitions, cultural performances, and speeches by dignitaries like U.N. Secretary-General António Guterres.

The historic vote in 1999 in what was known as East Timor marked a turning point in the nation’s struggle for self-determination, as it ended a brutal 24-year occupation by Indonesia and paved the way for Timor-Leste to become a sovereign nation in 2002. 

In the referendum, the people of East Timor  were asked to vote either for autonomy within Indonesia or full independence. The overwhelming majority of them chose independence.

The vote was held amidst a climate of violence and intimidation, with pro-Indonesian militias attempting to disrupt the process, but despite the threats, the Timorese people turned out in large numbers to cast their ballots. 

The events the government has planned for the 25th anniversary of the vote include exhibitions, cultural performances, and speeches by dignitaries like U.N. Secretary-General António Guterres.

Timor-Leste’s government has said that its strategic initiatives for 2025 include continuing economic and fiscal reforms, expanding infrastructure modernization, and strengthening social policies.

The lack of consistent income and limited formal sector jobs have left many citizens reliant on subsistence farming, according to the United Nations Developing Programme (UNDP). 

The private sector’s inability to create sufficient employment opportunities further exacerbates the issue, highlighting the urgent need for economic diversification and job creation in the young nation, it said.

Still, there is also a sense of hope. 

The World Bank forecasts that Timor-Leste’s economic growth will accelerate in the coming years, driven by easing inflation and a stable fiscal outlook. 

The current government has highlighted its achievements in areas like international integration, economic development, infrastructure, and social welfare during its first year in office. 

It cites Timor-Leste’s accession to the World Trade Organisation (WTO) and progress toward membership to the Association of Southeast Asian Nations (ASEAN) among the international achievements. 

Timor-Leste’s government has emphasized its commitment to social development, citing increased social pensions, adjustments to tax rates, and efforts to improve health care infrastructure and access to medication.

Infrastructure development remains a priority, with the upcoming rehabilitation of the President Nicolau Lobato International Airport and the recent installation of a submarine fibre optic cable linking Timor-Leste to Australia.

Local NGO La’o Hamutuk criticized “non-essential policies” in a report released this month.

It included Timor-Leste’s accession to the WTO and its ongoing pursuit of ASEAN membership as non-essential, saying those moves could hurt the local economy. 

 “[P]rioritize social issues and promote the domestic economy,” the NGO urged the government.

“Although the WTO says that promoting free markets will benefit all member countries, the truth is that dominating free trade will only benefit rich people, large nations and large companies that have been dominating world trade and investment,” it added. 

The report also raised concerns about the country’s economic diversification and fiscal sustainability, particularly highlighting the over-reliance on the Petroleum Fund, which will pay for about 83% of state expenditure this year. 

If the government doesn’t invest in productive sectors that can sustain Timor-Leste’s economy into the future, the report said the country could see an impending “fiscal cliff” – that is, a sudden and severe economic decline.