After Peaceful Elections, East Timor’s New Government Is Facing Headwinds

This report first appeared in World Politics Review , 8 August 2017, and has been republished with their permission. 

The latest round of elections in East Timor ended peacefully, far removed from the tumultuous and violent period of a decade ago. But the country that has become a model of post-conflict democracy is not without its challenges, including an increasingly complex and contested political arena and a troubled economy. In an email interview, Sue Ingram, a longtime practitioner, consultant and adviser on governance and statebuilding in fragile states, explains how East Timor found its political footing after the 2006 crisis and what is on the horizon.

WPR: What is the significance for East Timor of holding elections without U.N. supervision, and what does this milestone say about security sector reform and the post-conflict recovery in general?

Sue Ingram: The recent parliamentary elections in East Timor were the second national poll this year, following on from the March vote for the country’s president. They come almost five years after the United Nations peacekeeping mission wrapped up at the end of 2012, and it’s worth noting that the successful conduct of the 2012 elections was a benchmark for U.N. withdrawal. While the U.N. provided considerable logistical and technical support for the 2012 elections, this year East Timor was on its own. It handled the polling process and the associated security operation entirely with its own resources, and both elections have been commended as efficiently run and peaceful—further evidence, if needed, of the stability that has accompanied the country’s development since the rocky years of 2006-2008. Looking back to that period, in mid-2006 East Timor’s political leaders requested the return of U.N. peacekeeping in the face of a political and security crisis that saw the disintegration of elements of its security forces and widespread fighting, deaths and destruction of property in the capital. A central element of the peacekeeping mandate was supporting the government to review and rebuild the security sector, and in late 2012 the U.N. Security Council signed off on that work. Bilateral assistance has continued to support institutional strengthening in these areas. Equally important as the development of institutional capacity was a shift in political culture that brought an end to the factionalization of elements of the security forces, and underwrote an adherence to constitutional norms. Since 2008, East Timor has been something of a poster child for post-conflict stability. Through its leading role in the g7+ group of countries affected by conflict and fragility, East Timor has helped to shape the international discourse around post-conflict development.

WPR: What does the relatively strong showing of opposition parties suggest about how the government is perceived and whether it has effectively addressed issues important to voters, especially economic issues?

Ingram: To provide some context, since East Timor became an internationally recognized state in 2002, two political parties—Revolutionary Front for an Independent East Timor, or FRETILIN, and National Congress for Timorese Reconstruction, or CNRT—have formed the government either in their own right or in coalition with other parties, but never formally with each other. After the 2012 election, CNRT formed a governing alliance with two minority parties, leaving FRETILIN in the opposition. 
Within months of the election, however, a cooperative arrangement began to emerge between FRETILIN and CNRT. This came to be characterized as a form of inclusive or consensus democracy that was portrayed as more appropriate than combative politics for states emerging from conflict. All five national budgets, beginning with the 2013 budget, were passed unanimously by parliament, and the parties cooperated in other significant areas of public policy. In 2015, when Prime Minister Xanana Gusmao of CNRT stepped down from office in the middle of his term, he stunned pundits and his own coalition partners by anointing a FRETILIN member as his successor. 
At the time of the prime ministerial transition, analysts reflected on the dangers of an executive unchecked by a parliamentary opposition. Within months, the country’s nonpartisan President Taur Matan Ruak, known as TMR, was describing himself as the opposition voice that was missing from parliament. He became a trenchant critic of the government’s overall spending levels and priorities, and a strong voice for the country’s poor and for rural development. TMR now heads a new political party, Popular Liberation Party, or PLP, formed just months before the latest elections. It won eight seats in the 65-seat parliament and says it plans to occupy the opposition benches.
The second party to enter parliament for the first time is Kmanek Haburas Unidade Nacional Timor Oan, or KHUNTO. Having fallen just short of the electoral threshold to win any seats in 2012, KHUNTO has secured five seats in the most recent elections. Given its reported martial arts group affiliations, it may have appealed to elements of East Timor’s youth, many of whom are struggling to find a place in the formal economy and have little enthusiasm for the subsistence economy on which most livelihoods are still based. 

WPR: Do you expect any change in course in terms of how East Timor is being governed, and what will be the most pressing challenges facing the coalition once it's formed?

Ingram: Future policy direction will very much depend on the complexion of the governing alliance formed in the wake of the parliamentary election. Five parties will be represented in the new parliament: FRETILIN and CNRT with 23 and 22 seats respectively; Democratic Party, or PD, with seven seats; and the newcomer parties PLP and KHUNTO with eight and five respectively. At the moment, the precise shape of the future government is still anybody’s guess. Following the elections, FRETILIN signaled its continuing willingness to govern with CNRT, in keeping with its commitment to inclusive government during the election campaign. However, the secretary-general of FRETILIN has also hinted at a change in the status quo should his party form the government. Two weeks after the elections, CNRT finally ended its silence, formally resolving at a party congress to move into opposition, but it hasn’t ruled out individual party members joining the government. PD and KHUNTO have both indicated their willingness in principle to serve in a governing coalition, but have not committed to one.
Irrespective of the character of the alliance that forms the government, the country is facing several critical challenges. High on the list are: the medium-term fiscal outlook; the pressing need for economic diversification; and livelihoods for the country’s large cohort of younger people. From 2006, when payments from East Timor’s sovereign wealth fund for petroleum revenues first flowed into the national budget, governments have maintained expansionary spending programs well above the sustainable limit of the Petroleum Fund. With existing oil fields running dry and the development of new fields stalled, the medium-term fiscal outlook is bleak. East Timor is one of the most heavily oil-dependent economies globally, making economic diversification both a priority and a challenge. The country has the lowest median age outside parts of sub-Saharan Africa and Afghanistan, and young people have surged into the towns and a labor market unable to absorb them, creating real issues of anomie and disaffection. The next government will have its work cut out dealing with these issues.