East Timor's second major transition since independence

East Timor held peaceful elections this weekend, and is set to form a coalition government that helps transform one of the poorest Asian countries to a middle-income country by 2030.

The party of East Timor’s prime minister won the majority of seats this weekend in peaceful parliamentary elections, paving the way for him to form another coalition government as the country faces its second major transition a decade after independence. 

The elections come at an important juncture for the impoverished half-island country, which celebrated its 10th birthday May 20. The United Nations mission and police are slated to withdraw by 2013, by which time Australian and New Zealand troops who have been stationed there on a separate peacekeeping mission will have departed. These changes will leave the young democracy standing on its own feet, and perhaps in a better position to pursue its goal of joining the regional bloc known as ASEAN, or the Association of Southeast Asian Nations.

“The next five years are crucial for us,” says former President Jose Ramos-Horta.

The economic stakes are high. The Timorese people are among the poorest in Asia, but the country has ambitious plans to become a middle-income country by 2030.

The country has recently accrued $10 billion to $11 billion in oil and gas revenue, but relies on one field called Bayu Undan – which could run dry as early as 2024 – for some 90 percent of spending. In 2010 East Timor had only $17 million in nonenergy exports to its name, a signal of just how dependent the government is on its oil revenue.

After the parliamentary results came in Tuesday, Kay Rala Xanana Gusmao, the likely next prime minister, appeared confident that the country could achieve its ambitious plans to become a middle-income country by 2030.

He places his hope in potential revenue from an untapped oil and gas field known as Great Sunrise, which, like Bayu Undan, is situated under the ocean between East Timor and Australia. The tapping of it is currently on hold, as East Timor wants to pipe the gas to its south coast, but the companies involved want to set up a floating liquefied natural gas plant instead.

“I believe we will achieve this goal,” Mr. Gusmao says.

“The next government needs to invest in human capital, education, health, and infrastructure,” says Joao Alves Correia who voted near the country’s main international airport, which has flights to only three destinations – Bali, Darwin, and Singapore – another indication of East Timor's relative isolation from international trade links.

While it was expected that the current prime minister and the Democratic Party (PD) would continue their alliance from the outgoing 2007-12 governing coalition, another option is for Gusmao's National Congress for Reconstruction (CNRT) to align with FRETILIN, the second-biggest party, with 25 seats.

“We have at least 3 options,” said Gusmao in an interview at his party office in Dili, the capital, after the voting. His party won 30 seats, three shy of a majority that would allow it to govern alone. 

FRETILIN leader Mari Alkatiri on Tuesday repeated a call made before the vote for East Timor's old guard political leaders to forge a grand bargain – regardless of the result – for handing power over to younger politicians.

“Sooner or later we have to hand political power and leadership to the new generation,” Mr. Alkatiri told Dili newspaper Tempo Semanal.

Alkatiri, Gusmao, and Mr. Ramos-Horta are veterans of the Timorese independence struggle against Indonesia's 1975-99 occupation and have dominated the country's politics since Indonesia withdrew in 1999.

A call for a national unity government was also made by Ramos-Horta, who earlier this year lost out in the first round of the election for the mostly-ceremonial job as president and subsequently campaigned for the Democratic Party in the parliamentary election.

“We need a strong stable government and that can only happen if we have a national unity government,” said Ramos-Horta, a 1996 Nobel peace laureate.

Given the fact that the PD and another party were the only two other parties to win seats besides Gusmao's CNRT and FRETILIN, however, a unity government would leave East Timor without much of an opposition in parliament, raising questions about checks and balances.

That outcome might be a slap in the face for voters who lined up patiently in almost 90-degree heat on Saturday. Further concerns could arise from allegations of vote-buying coming from some defeated candidates and by the European Union election observer team, in what was otherwise deemed a free, fair, and peaceful vote. 

“It is important to vote and to choose who our next leader will be at this time,” Jacquelina Sarmento, a civil servant in Dili told the Monitor after voting in the capital on Saturday. "It is for our future as a country."