Introduction
Development is a process for the future, and includes education – free primary school for all, economic opportunity such as access to develop their own products, and justice for grassroots people, as well as participation of men and women in political leadership. [Berta]
The term ‘development’can mean different things to different people. The word is used to describe change in a multitude of sectors from infrastructural growth and urbanisation through to humanist disciplines of education and psychology. Concepts of ‘third world development’ arose in the post-colonial era strongly linked to economic development, the discipline from which international ‘development studies’ emerged. Mainstream theories of international development, which will be reviewed shortly, frequently assume economic growth in itself to be an unproblematic good. This approach to development often relies on broad national productivity indicators such as the gross domestic product (GDP) in order to illustrate that economic growth is taking place, with the assumption that development will follow.
This economistic approach to development is very far removed from the more socially inclusive understanding of development contained in Berta’s words in the vignette above. Berta’s comments gesture towards an understanding of development that embrace social, cultural and political relations as well as economic arrangements. Berta’s remarks underline the importance she places on the social relations of development. That is, if development is to be worthwhile and sustainable it must have a positive impact on the lives of the ordinary people. This is consistent with the views of my other research participants such as Carlos who considers development refers to ‘positive changes in people’s lives including standard of living, community relations, education and health becoming better and better’. Similarly, Isabela believes: ‘Development is to change in a meaningful and positive way and to do something for our nation…development is not just for people who sit in the government but for civil society to participate in the process’. For
Berta, Carlos and Isabela, development is therefore only meaningful to the extent that it is able to improve the lives of the poor within Timor-Leste. Importantly, each of them consider that the engagement and relationships between the government and the people are part of the development process.
In many ways their concerns parallel the views articulated within new development discourses since the 1990’s, which emphasise new practices of social analysis, community participation, gender sensitivity, and empowerment of local people as crucial ingredients for effective development. The role of civil society organisations is seen as fundamental to this inclusive form of development. Development then, in the minds of these activists, is not something done by the government for the people, rather that the people should be active players in the process of combating poverty and ensuring access of poor people to basic human rights.
This chapter analyses how different perspectives with respect to development have played themselves out in Timor Leste. After the 1999 devastation the international development agencies, together with the Timorese leadership embarked on a process of reconstruction, and set in place the basic structures of the new state. The strategies put in place by the UN and other international donors for the reconstruction of national infrastructure and new structures of government, judiciary and administration are all informed by tacit assumptions concerning the nature of development. I investigate how development discourses have shifted from economic development models to a broader understanding encompassing the social and cultural implications of development and change. This, I argue, has lead to a whole new lexicon in the discourse of development linked to concepts of agency, participation, inclusion, democracy, transparency and rights.
Concepts of Development
We are working between two big expectations. One is the expectations of the people – always looking to have everything yesterday and not tomorrow, and second, the expectation of the international community that is always considering Timor-Leste a success story. It is not easy governing the country having these two expectations. (Alkatiri 2005a)
Poverty in Timor Leste is widespread. It registers as the poorest country in Asia with poverty highest in rural areas where 85% of people live (Planning Commission 2002). In standard economic terms the GDP per capita in Timor Leste has declined since independence. There was a significant peak of GDP at $470 per capita in 2001 when international aid for emergency and rehabilitation programs was at its height, and a subsequent decline to $366 in 2004 when the UN and many other international organisations departed (UNDP 2006; World Bank 2005b). The poverty line, the minimum required to provide food, clothing and shelter, is globally set at US$2 a day, while US$1 a day is set as an indicator for ‘extreme poverty’ (Green 2008:8). In Timor Leste the poverty line is officially set at just 0.55 cents a day - Timorese with an income less than this are considered to be living in poverty89
It is the Human Development Index (HDI) rather than the GDP which gives a real picture as to whether the real living standards are improving. In 1990 the HDI was established by the UNDP as an alternative model to the more narrowly based economic indicators. Hence the HDI incorporates not only economic indicators but national indicators on health, education, longevity and gender differentials such that the impact of development on the population can be measured. The HDI indicate how government policy addresses issues of poverty. For example, Sri Lanka has 60% less income per capital than Kazakhstan, an oil rich country, but due to its effective public health care system, a Sri Lankan child is five times less likely to die in the first five years of life, more likely to go to school, have clean drinking water and have use of a latrine than a child in Kazakhstan (Green 2008).
. On this basis 40% of the population fail to reach a minimum standard of living (UNDP 2006:13). Until the petroleum oil revenues came on stream in 2005, the economy was not growing quickly enough to keep pace with the rapid growth of the population.
Timor Leste’s ‘social development’ ranking, as measured by the HDI, is extremely low. In 2006 Timor Leste ranked at 142 of 177 countries in the HDI, the lowest ranking Asian country. This ranking did, however, represent a rise from the 1999 ranking of 152 of 162 countries. Indicator values in 2006 show a stable life expectancy at 56 years; a positive increase in the literacy rate from 40 to 50% of adults (15 years and above); and an increase in school enrolments from 59% to 71% from 1999 (UNDP 2006). Timor Leste has a high
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This poverty indicator was raised to 88 cents a day in 2008 according to the Minister of Finance, Emilia Pires’ presentation at the VLGA offices, Melbourne, 27th February 2009.
level of morbidity from preventable diseases such as malaria, tuberculosis and childhood infections, but access to health care has increased. Only 58% of household have access to clean water and 36% to sanitation (UNDP 2006).
Before proceeding to the discussion on the impact of development strategies in Timor Leste, it is pertinent to consider the theories of ‘development’ that have been debated and disputed for at least the past half century. During the post-second world war phase of decolonisation, development aid was established as a means to fund infrastructural support in newly independent countries. Engineers and economists were contracted to provide the technical know-how that would ‘kick start’ economic progress. The stages theory of development from pre-capitalist to fully fledged capitalist economies was popularized. These ideas were encapsulated by Rostow’s modernisation theory90. A number of Latin American economists challenged this view arguing that developed countries advanced economically through the extraction of cheap resources from their colonies. Underdevelopment, they claimed was a process not simply a condition. The wealth of the ‘core’ countries, they claimed, was the result of the exploitation of ‘the periphery’. Moreover, it was argued that growing inequalities between the core and the periphery would deprive developing countries from achieving the levels of development seen in the west91
Portugal clearly engaged in classical exploitative colonial practises, such as described in dependency theory, extracting from East Timor precious sandalwood and introducing coffee, as well as extracting a head tax and forced labour. These measures condemned the Timorese to poverty and severely impacted on family food production. In return the Portuguese contributed neither the health care nor education to the majority of the Timorese, such services provided only by the Catholic missions, and for the Timorese elite who were ‘assimilated’ into Portuguese society. While exploiting the Timorese for
. Both Rostow’s theory of economic development and the dependency theory were firmly centred on a view of development based on economic growth.
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Rostow developed a theory of ‘Stages of Economic Growth’ in 1960. This holds that underdevelopment is due to lack of capital and skills, thus with a transfer of capital and technology to underdeveloped countries they will become developed. This theory regarded the improvement of people’s livelihoods and standards of living as a by-product and consequence of modernisation (Remenyi 2004:25).
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The ‘Dependency Theory’ was elaborated by the economists at the UN Economic Commission for Latin America. With major changes in the global environment, the debate between Moderisation theorists and Dependency theorists reached an impasse. The collapse of the ‘second world’ resulted in unchallenged dominance of the free market (Schuurman 1993).
economic purposes they were also promoting the adoption of Portuguese culture as being synonymous with development.
It is, however, the modes of international market de-regulation that developed throughout the 1980s and 1990s that have had the most significant impact on the trajectory of development within Timor Leste today. Adoption of the free market economic policies became development orthodoxy with the rise to power of Margaret Thatcher in the UK and Ronald Reagan in the USA. The free market approach espoused a strong economy as the driver of development, and a rising GDP as the means for governments to support delivery of social services.
Termed neo-liberalism by some, this model of development formulated and enacted by the International Monetary Fund (IMF) and the World Bank has been influential over the past quarter of a century. These two Bretton Woods international financial institutions (IFIs) 92 provide finance through loans to poor countries in exchange for the implementation of agreed free market policy measures. Loans are defined as aid where the interest is set at concessional levels93
Global institutions such as the IMF and the World Bank have been the principal institutional mechanisms driving neo-liberal policies, which have been widely introduced in the form of structural adjustment programs (SAPs). This approach was formalised in what is known as the ‘Washington consensus’ referring to economic reforms that donors subsequently uniformly imposed on countries around the world as a condition of eligibility . According to McKay, it bears a number of similarities to earlier ‘modernisation’ discourses. Indeed, McKay claims that ‘some features have been redefined and reworked but the basic points about unequal power and the exploitation of the poor countries remain’ (McKay 2004). This approach to development not only grants primacy to market forces but insists that developing nations deregulate their economies in order to be the recipients of global financial assistance.
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Key international financial institutions (IFIs), the International Bank for Reconstruction and Development (World Bank) and the International Monetary Fund (IMF), formed in 1944 at a conference in Bretton Woods to plan the finance for the rebuilding of Europe after the 2nd world war, have been at the centre of the major global economic strategy based on free market strategies over the last two decades (Stiglitz 2002:11). 93
‘Official Development Assistance’ (ODA) is defined by the OECD as being flows from official sources for the promotion of economic development and welfare of developing countries as its main objective; and it
is concessional in character with a grant element of at least 25%. Thus concessional loans are defined as ODA while non-government organisation’s grants are not.
for development loans. This leverage ensured a reduced role of governments and promotion of the private sector and market as the main vehicle for economic development. Many countries that implemented SAPs have not risen out of poverty. Countries with low levels of human resource development and poor infrastructure have been shown to be at a disadvantage when competing in an open market, and there is empirical evidence to suggest that open market policies have not contributed to reducing poverty in less developed countries (Killick, Tony 1998; Mosley, Harrigan & Toye 1995; White 2001). The 1980s became known as the ‘lost decade’ in development, as the needs of populations were largely by-passed by the top down approach of development programs. As in the poorest countries the gap between the rich and poor has widened, a number of economists and social analysts argue that a uni-linear focus on ‘economic growth’ has led to rising inequality domestically and internationally. Some of these commentators have argued for a return to a greater investment in human capital in the form of education and health in order to sustain growth and stem inequality through more sustainable forms of development (Seligson 2003:468). Whilst the ‘Asian Tigers’ (Singapore, South Korea, Hong Kong and Taiwan) are claimed as proof of success of the development model, they nonetheless had invested heavily in human resources (education and health) and public infrastructure for many years before they opened their doors to the free market. In contrast many least developed countries today are expected to weather exposure to the free market at a time when they have limited capacity to compete. In many cases poor countries lack the human capital to be able to engage in the economic activities required for domestic development let alone survive in the brutal world of international trade.
The power of the World Bank and IMF over the policies that affect most of the world’s population is held by a handful of individuals who have little direct engagement with development challenges of poor countries. Joseph Stiglitz, former Chief Economist at the World Bank brought to an end the World Bank’s single minded focus on free market strategies of the Washington consensus. He noted that these institutions are accountable to no-one, a fact partly responsible for the failure of twenty years of free market promotion to achieve the vital goal of social transformation:
Development is about transforming societies, improving the lives of the poor, enabling everyone to have a chance of success and access to health care and
education. This sort of development won’t happen if only a few people dictate the policies a country must follow (Stiglitz 2002:252).
Looking beyond microeconomic principles, a ‘post-Washington consensus’ acknowledges the existence of market imperfections and embraces the concept that strong social and institutional structures are crucial to growth and development. This has generated a view that social capital, in the form of social networks and civil institutions, are as important as other forms of capital to achieve these ends. Further, these social structures need to be supported by pluralistic forms of governance and decision making to develop social consensus over key reforms (Edwards 2001).
In recent years the World Bank has engaged the most innovative social researchers and also drawn extensively on work in the social sciences in order to articulate its own development agenda. In this way the World Bank has gained leverage over the subject of social capital and participatory practices by recruiting sociologists, while deflecting challenges from its own discipline of economics (Fine 2001). This, Fine argues, has enabled free market economic policy makers to continue their domination.
It is important to note that during the Indonesian occupation, key leaders of the first Timorese government were in Mozambique where the external headquarters of FRETILIN’s Central Committee was situated94
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Key external members and their roles in the first government were Mari Alkatiri, Prime Minister; Jose Ramos Horta, Minister for Foreign Affairs; Rogerio Lobato, Minister for Internal Affairs; Roque Rodrigues, Minister for Defence; Ana Pessoa, Minister for State Administration; Estanislão da Silva, Minister of Agriculture; Jose Luis Guterres was Ambassador to UN, then Ministry of Foreign Affairs in the second government (Scott 2005).
. There, they experienced the powerful influences of the IFIs after Mozambique was forced to adopt a structural adjustment program. Mozambique, like Timor Leste, became independent in 1975 as a result of the change of government in Portugal. The liberation movement, FRELIMO, became the first government. FRELIMO had forged links with the eastern bloc in order to obtain arms for the independence struggle against Portugal, and had adopted a Marxist-Leninist ideology. After independence, the country was shunned by western nations, while Rhodesia, and later South Africa, created and backed the militia army of RENAMO to destabilise the fledgling government. During a decade and a half of war, the militia carried out widespread atrocities against the people and destruction of infrastructure, which eventually brought Mozambique to economic collapse. The country was forced to negotiate with the
IMF and World Bank and accepted a SAP package in 1987 to obtain necessary finance. The FRELIMO government adjusted its policies to become a social democracy and has continued to hold power until the present day. However, the SAP resulted in Mozambique becoming one of the worlds’ highly aid dependent and indebted countries, a status that Timor’s political leaders were, upon assuming power, anxious to avoid.
Since 2000, a new consensus emerged to tackle world poverty. Leaders of the rich nations have signed on to the Millennium Development Goals (MDGs) which set out defined targets on eight goals to be achieved by the year 2015. These include halving the incidence of extreme poverty, universal primary education, gender equality and the empowerment of women, reduced child mortality, improved maternal health, combat of endemic diseases and environmental sustainability. Achievements are monitored and published in the UNDP Human Development Report against targets for each country (Timor Leste figures in UNDP 2006). Since the MDGs became a measure of development progress, IFI policies that had been imposed, such as imposing user fees on primary education and health clinic attendance, are being revised. The World Bank no longer supports user fees in education, although its policy on health is more ambiguous (Green 2008). Human resource development through education for all and access to health care are increasingly recognised as fundamental human rights that are also the basis of poverty reduction.
Finally, it is useful to consider the expansive definition of development which has been coined by Amartya Sen, the architect of the UN human development indicators: ‘freedom is both the means and the end of development’ (Sen 1999). Sen speaks of ‘unfreedoms’