Timor-Leste must keep itself debt-free, urge CSOs
Published on Tue, 2011-09-13 11:58
Sources: ETAN, La’o Hamutuk The government of Timor-Leste must "keep the nation debt-free and refrain from borrowing money from international lenders […] to protect its future generations," warned 137 civil society organizations based in 32 countries. Dili has not borrowed foreign funds since its independence in 2002. "Rather than repeat the mistakes of other developing countries that have struggled with debt during recent decades, Timor-Leste should learn from their experiences, which often inflicted great hardships on their people," argued the groups in a statement. The government in Dili launched in 2009 several legislative, diplomatic and financial actions towards borrowing money from foreign governments and institutions, which is likely to happen in 2011, reported the Timor-Leste Institute for Development Monitoring and Analysis (La’o Hamutuk), one of the national groups that promoted the statement. The World Bank is encouraging Timor-Leste to "assess options for creating fiscal space and financing the budget deficit, ensuring quality of expenditure," according to La’o Hamutuk. The Asian Development Bank and other multilateral institutions agree. The civil society’s statement warns that "when Timor-Leste's oil and gas run out in less than 15 years, and debts still must be repaid, our children and grandchildren will suffer the consequences." The campaign was initiated by Timor-Leste's Movimento Kontra Deve (Movement Against Debt, facilitated by La’o Hamutuk) and the U.S.-based East Timor and Indonesia Action Network (ETAN). International networks with long experience in debt are among the signers, including Focus on the Global South, Jubilee South-Asia Pacific Movement on Debt and Development, the Third World Network and CADTM International (Committee for the Cancellation of Third World Debt). Twenty groups in Timor-Leste signed the statement, including La’o Hamutuk, the NGO Forum, Student Front, Community Leaders Forum, Haburas Foundation and ETADEP. Signing organizations from Timor-Leste’s southeast Asian neighbors include WALHI - Friends of the Earth Indonesia, Freedom from Debt Coalition Philippines, International NGO Forum on Indonesian Development (INFID) and EARTH (Ecological Alert and Recovery Thailand). Other signers have long supported the people of Timor-Leste, such as Jubilee USA, the International Platform of Jurists for East Timor, Oil Change International (USA), Aidwatch (Australia), Friends of the Earth U.S., Bank Information Center (USA), Tapol (U.K.), CAFOD (U.K.), Japan East Timor Coalition, and the Free East Timor Foundation (VOT, the Netherlands). Income from oil and gas provides 95% of Timor-Leste's state revenue, making the country the most petroleum-export dependent in the world. Although Timor-Leste has not yet borrowed funds from other countries or international financial institutions, the government has passed several laws to enable borrowing, including the 2009 Budget and Financial Management Law, as well as revisions to the Petroleum Fund Law and the new Public Debt Law both passed last month. In August, the Asia Development Bank posted information on its website about a proposed $8.15 million loan to Timor-Leste to upgrade the national road network. More information
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