TL and the Millennium Challenge Corporation

Lao Hamutuk has posted a new web page about the Millennium Challenge Corporation (MCC, a U.S. government agency) which includes Timor-Leste’s history of negotiation for funding and the recently-agreed $10.5 million, three-year program to improve childhood immunization and combat corruption. The page contains much more information than this summary, including tables, graphs and links to relevant documents.

A few years ago, Timor-Leste hoped to get more than $300,000,000 from the MCC to construct local infrastructure. Timor-Leste qualified for MCC funding in early 2006, but the process of negotiating an agreement (called a "compact") was never finished, due to the "crisis" and the change of government in Dili. MCC tabulates new scores every year, which are used to decide whether a country is eligible to sign a compact. In the figures announced at the end of 2007, Timor-Leste's indicators (particularly the one on controlling corruption) had fallen below the required levels.

However, the U.S. Ambassador and Timor-Leste Government persuaded the MCC to bend the rules, and Timor-Leste remained eligible for another year, although a compact was not agreed. When scores dropped further at the end of 2008, the MCC board ruled Timor-Leste ineligible for a compact but allowed "Threshold" status which provides a lower level of funding to help improve the scores.

The scores tabulated by MCC in October 2009 were slightly lower, in part because Timor-Leste's scores are now compared with those from less impoverished countries, because of high oil revenues. To again become eligible for a compact, Timor-Leste needs to pass the Control of Corruption and at least one additional indicator.

In May 2010, Timor-Leste and MCC agreed on a "threshold program" designed to improve the Control of Corruption and Immunization Rates scores.Under the program, which is managed by USAID, anti-corruption will get $5.2 million, immunization $2.3 million, and the remaining $3 million is for Monitoring and Evaluation of the program.

Parliament Committee turns back gov't budget proposal

At the end of May, Timor-Leste's Government proposed a mid-year budget rectification, including $178 million in new expenditures (a 27% increase) and an additional withdrawal of $309 million from the Petroleum Fund. They requested that $811 million be transferred from the Fund in 2010, far above the $502 million Estimated Sustainable Income (ESI). Parliamentary committees held hearings with Ministers and others, and Committee C (Economy, Finances and Anti-Corruption )reported (English or Portuguese) their findings to the Parliamentary plenary on 22 June.

Committee C recommended approval of only $52.3 million of the $178 million in new expenditures proposed by the Government. The Committee also recommended against withdrawing more than the ESI from the Petroleum Fund and suggested that the Decentralized Development Package (PDD) projects be managed by their original ministries as capital expenditures, rather than becoming public transfers under the Ministry of State Administration.  Its 38-page report contains many other comments and recommendations.

As Parliament begins its two-week plenary debate, La'o Hamutuk feels that the Committee's analysis should be widely available, so we have scanned the Portuguese report and made a preliminary English translation. Follow these links for background information, analysis, and the budget documents or for La'o Hamutuk's submission to Committee C.

Submisaun LH nian kona ba Orsamentu Rektifikativu 2010

Loron 15 Junu, La'o Hamutuk fo testemunha ba Komisaun C iha Parlamentu Nasional kona ba esbosu Orsamentu Rektifikativu 2010. Ami mos hakerek submisaun kona-ba asunto tuir mai:

• Timor-Leste Hakbesik ba “Malisan Rekursu”
• Gastus la Sustentavel no Ilegal husi Fundu Petroleu
• Timor-Leste Tenke iha deit Siklu Orsamentu Ida ba kada Tinan ida
• Pakote Dezenvolvimentu Desentralizadu (PDD) diak oituan
• Hein ba Planu Estratejiku Desenvolvimentu Nasional
• Hadalas Gastus ba Eletrisidade
• Hasa’e Importasaun no Fan Fos 

Clik iha ne'e atu hetan informasaun no analiza tan kona bo orsamentu rektifikativu, ho ligasaun ba dokumentu no submisaun seluk.

LH submission on mid-year budget rectification

This morning, La'o Hamutuk gave testimony to Parliament Committee C on the proposed budget rectification, which we followed up with a written submission covering the following topics:

• Timor-Leste is getting closer to the “Resource Curse"
• Unsustainable, illegal spending from the Petroleum Fund
• Timor-Leste should only have one budget cycle each year
• Package of Decentralized Development (PDD) is a little better than Pakote Referendum
• Waiting for the Strategic Development Plan
• Spending double on electricity
• Increasing imports and resale of rice 

Click here for more information and analysis on the budget rectification, with links to documents and other submissions.

Deepwater Horizon and Kitan

During the next year, three production oil wells will be drilled at Kitan, in the Joint Petroleum Development Area. The wells will be drilled by the Transocean Legend, under contract with Eni, the operator of the field.

Transocean is also the owner and operator of the Deepwater Horizon rig, where an explosion killed eleven workers and which continues to spew more than 12,000 barrels every day into the Gulf of Mexico. Coincidentally, the Deepwater Horizon explosion occurred on the night of 20 April 2010, one day before Timor-Leste's National Petroleum Authority approved the Kitan Field Development Plan.

La'o Hamutuk has updated our web page on the Kitan project with information on the Transocean drilling rig and Bluewater FPSO, as well as a comparison of the Kitan and Gulf of Mexico projects. We encourage everyone involved to make sure that nothing like the accident in the Gulf of Mexico happens here.

Parliament prize money to ANTI/Osan Premiu ba ANTI

On 20 May the RDTL Parliament gave awards to several people, including La'o Hamutuk's Charles Scheiner, who had supported Timor-Leste's struggle for independence.  The award came with $2,500.  For reasons explained in the following open letter (translated from Tetum), which was printed in the Timor Post today, Charlie is giving the money that Parliament gave him to the Timor-Leste National Alliance for an International Tribunal.

Clik iha imagem iha liman los atu le'e karta ida ne'e iha lingua Tetum.

27 May 2010

His Excellency Fernando “La Sama” Araújo

President of the RDTL National Parliament

Dear Excellency,

I‘m writing to express my gratitude and appreciation for the “Princess Grace of Monaco” medal that the National Parliament awarded to nine people on the eighth anniversary of Timor-Leste’s Restoration of Independence last Thursday. I was honored to be recognized by your excellencies, and to be included in the company of people like Rob Wesley-Smith, George Junus Aditjondro and others from Australia, Portugal, New Zealand and Finland who participated in Timor-Leste’s struggle to free itself from Indonesian occupation.

Like other activists in the East Timor Action Network/United States (ETAN) and around the world, I received much more from my involvement than I gave. I continue to feel privileged to travel with so many Timorese friends on the journey from occupation to independence, from being ruled by an oppressive foreign regime to having the power to make your own decisions.

That voyage is not yet over. Although Timor-Leste has achieved political independence, we live in a world of globalization, big-power politics, endangered environment, corporate greed, and huge hopes from the Timorese people. In the 21st century, no nation is truly independent. For Timor-Leste, emerging from centuries of foreign rule, decades of war, widespread poverty and very little sustainable economic activity, the challenges ahead are as difficult as the struggle against occupation. Like Parliament, La’o Hamutuk is working to help develop and implement wise and just policies – that, given Timor-Leste’s  limited resources and experience, can meet the needs of its people.

I am grateful for the $2,500 that Parliament gave me and the other award recipients, but I did not expect and do not want financial rewards for my participation in Timor-Leste’s struggle. Therefore, I will give this money to a new generation of activists who are continuing this campaign for human rights and justice – the Timor-Leste National Alliance for an International Tribunal (ANTI).

One of the most critical unfinished aspects of the struggle for independence is ongoing impunity. Until the major perpetrators of serious crimes from 1975 to 1999 are held accountable for their actions – which is primarily an international responsibility – the peoples of Timor-Leste and Indonesia will not live in peace. Cycles of impunity, lawlessness and violence will continue, preventing the stability, security and development which Timor-Leste’s people have fought for.

The student generation of the 1970s declared Timor-Leste’s independence and have led this country for the last eight years. Students from the 1980s and 1990s, including yourself, played key roles in restoring that independence and are now the heart of the state. Last week,  Parliament recognized a few international activists who helped make these movements global, but this work is not finished.

Today, a new generation of young activists has joined Timor-Leste’s struggle for justice and human rights, through ANTI and other movements. Once again, I am fortunate to participate in their campaign, and I thank Parliament for enabling me to provide some much-needed financial support for their work.

A luta continua.

Sincerely,

Charles Scheiner

2010 Mid-Year Budget to $838 million

La'o Hamutuk has a new web page with analysis and documents on the mid-year budget rectification. An excerpt follows:

On 31 May 2010, the Council of Ministers approved an "orsamento rektifikativu" mid-year budget adjustment which increases the state budget by 27%, from $659,996,000 to $837,981,000. It was submitted to Parliament the same day, and the Government hopes Parliament will approve it by 14 July.

Although only $178 million has been added in expenditures, the proposed revision increases the amount withdrawn from the Petroleum Fund during 2010 by $309 million, to a total of $811 million. This increase is above the previously-allocated $502 million Estimated Sustainable Income level, and will reduce the ESI by about $9 million every year in the future. We understand that the Ministry of Finance is proposing to withdraw more than the amount necessary to fill the 2010 budget deficit so that they will have a cash cushion in the event the 2011 budget is approved late or unexpected expenditures arise at the end of the year.

See the website for a Council of Ministers press release with the Government's goals  for the budget rectification, as well as the proposed budget rectification law and other documents.

The budget contains many new programs and expenditure increases. La'o Hamutuk is listing a few of the largest or most interesting ones, but there are many more.