The foreign affairs department continues to deny a passport to a former-spy-turned-whistleblower despite a spying legal case being dropped.
The former Australian Secret Intelligence Service agent was a key witness for East Timor in a case against Australia over allegations Dili's cabinet rooms were bugged during negotiations over a gas and oil treaty in 2004.
Witness K was supposed to give evidence at the Permanent Court of Arbitration in the Hague but had been unable to leave Australia because his passport was seized in 2012. East Timor in January dropped the spy case against Australia as an act of goodwill ahead of negotiations on a maritime boundary.
Crossbencher Nick Xenophon grilled Attorney General George Brandis about the passport issue during a Senate estimates hearing in Canberra on Wednesday. Senator Xenophon pointed out the domestic spy agency ASIO had no security concerns about Witness K receiving a new passport.
Senator Brandis said he couldn't comment on the matter because it was before the Administrative Appeals Tribunal.
East Timor's first president to be elected as a member of a political party, Lu-Olo, is expected to renew his country's push for a maritime boundary halfway between Timor and Australia, according to a former president.
East Timor's relationship with Australia is too important to dramatically change under its new leader, according to former President Jose Ramos-Horta.
However, he also said President-elect Francisco Guterres, also known as "Lu-Olo", will renew his country's push for a maritime boundary halfway between Timor and Australia
Australia and East Timor are currently renegotiating their boundary, after a treaty was torn up when it emerged Australian spy agencies had bugged Timorese offices during the negotiations.
That now-defunct treaty put 80 per cent of the Greater Sunrise oil and gas field, worth an estimated $40 billion, in Australia's territory.
Mr Ramos-Horta, a Nobel laureate who was president from 2007 to 2012, said he expected President-elect Guterres to maintain East Timor's push for equidistant boundary, which would put Great Sunrise entirely in East Timor's territory.
Energy security has become a big political issue in Australia in recent months, with a potential gas shortage looming in parts of the country.
But East Timor is a small country working to diversify its economy 17 years after it gained independence following a bloody 25-year struggle against Indonesia following the 1975 departure of the Portuguese, who had colonised the island.
In an interview ahead of a public speaking engagement in Darwin on Thursday, Mr Ramos-Horta said once the boundary was agreed to there would be opportunities for the two countries to work together to exploit the energy reserves.
"Australia's the closest country [to East Timor], it would make sense for us to engage with Australia also on energy security by jointly benefiting from exploration, commercialisation of resource in the joint Timor Sea," he said.
He added that his country also wanted Australia's help in maritime security issues such as people smuggling and illegal fishing. Australian relationship 'too important' to change
President-elect Guterres was the first person to be elected president while a member of a political party in March. He is also the president of Fretilin, the party which began as a revolutionary independence group.
All former presidents elected in East Timor have resigned from political parties before running for office. Mr Guterres will be sworn into office on May 20.
Mr Ramos-Horta said East Timor's relationship with Australia would not change under Mr Guterres. "The relations with Australia are far too important to expect any significant changes from a new president, a new government," he said.
"Relations are very important and very good, we have excellent cooperation at every level. If anything, President Lu-Olo, will be more active in cultivating relations in Australia."
Mr Ramos-Horta told Lateline last week that the dispute with Australia over the maritime boundary and gas resources risked pushing East Timor closer to China diplomatically.
China has built Dili's presidential palace, and buildings for East Timor's foreign affairs department and defence department as gifts to the Timorese people.
But he said his country's relations with China would stop short of supporting their controversial land claims in the South China Sea. "Australia has greater relations with China than us," he said.
"Australia sells anything it can think of to China, it doesn't sell more only because China cannot buy more. China has built for us only three buildings, none of which are equivalent to any modern building you have here in Darwin."
Before the US election Mr Ramos-Horta warned US President Donald Trump would be a threat to the security of the world if he became president.
But the Nobel Peace Prize laureate said it was too early to tell what sort of president Mr Trump would be. Mr Ramos-Horta said Mr Trump is a pragmatist and global relationships will change quickly under his leadership.
"Of course Donald Trump is absolutely completely new, very different, from any conventional traditional American president as we know," he said. "[He's] unpredictable, [but if] everything stabilises and settles in the next six months, one year, maybe that will be the indication of the next three years."
Naaman Zhou The former Timor-Leste president Jose Ramos-Horta has told the Australian government to abandon its "unsubstantiated" legal case to extend its borders into the Timor Sea, as the two countries attempt to negotiate a permanent maritime boundary over lucrative oil fields.
Speaking at a Labor party-hosted event in Sydney, Ramos-Horta called Australia's case that the border should follow the edge of its continental shelf "unsustainable law" that bordered on bad faith.
The two neighbours have tussled over ownership of the oil-rich Timor Gap since Timor-Leste's independence in 2002, including the revelation that Australia bugged the Timor-Leste government's cabinet room in 2004 to gain a competitive advantage.
Ramos-Horta warned the government not to risk recently mended relations by pushing to control the lucrative Greater Sunrise oil field.
"We simply call for a just result," said the 1996 Nobel laureate. "The law of the sea that binds this compulsory conciliation says we have to negotiate in good faith. It could take us back to square one if Australian negotiators go back to their unsustainable continental shelf argument."
The Labor infrastructure minister, Anthony Albanese, who invited Ramos-Horta to speak, encouraged productive negotiations between the two countries.
"Good neighbours treat the less powerful in a positive way we have obligations to the East Timorese to treat them fairly," he told the Balmain Town Hall, where Ramos-Horta was delivering a lecture in honour of former deputy Labor leader, and Albanese's mentor, Tom Uren.
Ramos-Horta repeatedly dismissed Australia's long-held position on the boundary, saying the border should be drawn equidistant between the two countries.
"The law of the sea is straightforward... a line through the middle is drawn. This was the law in the 1950s and it is the law today. Australia has never denied the claim, put by those less diplomatic than me, that this is a resource grab. But this approximates our sentiments."
The disputed oil fields are estimated to hold natural gas and liquefied petroleum resources worth $53bn.
Confidential negotiations between the two countries commenced in January in the permanent court of arbitration in the Hague, with a result due in September.
Negotiations began after Timor-Leste decided to terminate an existing treaty that established a 50-year temporary boundary and would have split oil revenue 50-50.
"There is a consensus among scientists that Timor-Leste and Australia are part of the same continental shelf, so if Australia persists with the continental shelf claim, it should claim Timor-Leste. Or vice versa, Timor-Leste should claim the whole of Australia," said Ramos-Horta to laughs from the audience. "We will leave Tasmania alone," he added. "They are very nice people."
Ramos-Horta also criticised the Australian government's decision in 2002 to secretly withdraw from UN maritime boundary dispute resolutions contained in the UN convention on the law of the sea, so it could escape legally binding arbitration.
"We can get cynical about international law but in reality it has prevented wars occurring," he said.
"If each country withdrew from international law, then we would be in a lawless world and only the strongest would prevail. It is remarkable that a solid, old democracy like Australia would be the first to give emerging countries the wrong example.
"You had strong doubts about your legal position, and with your brilliant international lawyers, knew your position was not sustainable. So what did you do? Withdraw."
Also in attendance were the ambassador from Timor-Leste, Abel Guterres, and the federal Labor MP Linda Burney.
Ramos-Horta is the current UN head of integrated peacebuilding in Guinea-Bissau. He served as president of Timor-Leste from 2008 to 2012 and received the Nobel peace prize in 1996 alongside fellow East Timorese peace activist Carlos Filipe Ximenes Belo.
East Timor's former president Jose Ramos-Horta has issued a blunt warning to Australia that the gas dispute between the two countries risks pushing Timor closer to China.
Australia and East Timor have been locked in a messy dispute that has included allegations of Australia spying on its poorer neighbour during negotiations for an oil field in the Timor Sea, worth an estimated $40 billion.
Earlier this year at the UN Conciliation Commission Australia agreed to enter a new round of negotiations. But Dr Ramos-Horta told Lateline that the legal battle has already cost his country tens of millions of dollars and it risks causing a long-term rift.
"If Timor Leste cannot get a fair deal with this great wealthy democratic friendly country, if Timor Leste cannot get sympathy and support form Japan, the US, obviously there is an alternative," he said. "The alternative today is always China."
Already, China has built offices for East Timor's foreign affairs department, the defence department and the presidential palace.
The Federal Government's 2016 Defence White Paper spelled out the need for Australia to maintain good relationships with its neighbours, like Timor.
"We cannot effectively protect Australia if we do not have a secure nearer region, encompassing maritime South East Asia and South Pacific (comprising Papua New Guinea, Timor-Leste and Pacific Island Countries)."
Dr Ramos-Horta said China is the second largest economy in the world and it was East Timor's "sovereign right" to strengthen ties. "There is an alternative, there's always China, unlike 20 years ago when China was not booming as strong as it is today."
Lindsay Murdoch East Timor's prime minister has asked a Dili court not send two journalists to jail in a controversial defamation case he brought against them that was condemned by human rights and press freedom organisations.
"I consider that, once the truth of the facts has been restored... defendants should not be sentenced as proposed by the Public Prosecution Service," Rui Maria de Araujo told the court in a letter, according to the Portuguese newsagency Lusa.
Mr Araujo made the intervention on the eve of a court on Thursday sentencing Raimundos Oki and Lourenco Martins Vicente, his former editor at the Timor Post, on charges of "slanderous denunciation."
Timorese journalists and the International Federation of Journalists, the Australian journalist's union MEAA, the Committee to Protect Journalists and the South East Asia Journalist Unions have backed protests this week against Mr Araujo's pursuit of charges against the journalists that raised serious questions about freedom of expression in the country, one of only a few in south-east Asia with a free press.
Mr Oki, a 32 year-old freelance journalist, has been preparing to go to jail after prosecutors pushed for a one year jail sentence for him and a two-year suspended sentence for Mr Vicente.
Jim Nolan, a Sydney barrister and legal adviser to the International Federation of Journalists, who has travelled to Dili to observe the case, said convicting the men will stain the reputation of democratic East Timor.
"The case is all the more grave as it involves an article which attacked the prime minister," he said. "Any decision will also be an encouragement to authoritarian governments in the region which has been marked by increasing attacks upon the press."
Malaysia, Cambodia, Myanmar and Thailand are among countries that have imposed harsh restrictions on journalists.
Leading East Timor journalist Jose Belo said government leaders in Dili are using laws they produced to oppress the media. He said if Mr Oki and Mr Vicente go to jail "that's the beginning of a new era of the country's leaders killing the free press."
The charges relate to a 2015 article that claimed Mr Araujo, when he was an adviser to be finance minister, had recommended a winning bid for a government contract but misnamed the company.
A week later, Mr Oki corrected the report and apologised. But in January 2016 Mr Araujo who had become prime minister the year before filed a criminal defamation suit and has refused since then to back down.
The charges prevented Mr Oki, one of East Timor's most promising journalists, from accepting an Australian scholarship that would have seen him gaining experience in the newsrooms of Fairfax Media and the ABC.
Helen Davidson, Dili "If the court wants to send me to jail, I won't be happy but I have to be brave. I will accept the final decision. I'm ready to be in prison if the court maybe wants to put me in the prison."
Raimundos Oki, a 32-year-old journalist, is standing in the small offices of the Timor Post, in Timor-Leste's capital Dili, exasperated with his government. "I'm not a corruptor, I'm not a criminal."
Oki is facing jail time as the country's prime minister pursues a criminal defamation case against him and the Timor Post.
Last week Oki appeared in court alongside his former editor, Lourenco Martins Vicente, where prosecutors pushed for one year's jail for Oki and a two-year suspended sentence for Martins. The pair will learn their fate and any subsequent sentence next week.
Ahead of the sentencing decision, human rights and press freedom organisations including Amnesty, the International Federation of Journalists (IFJ) and international media unions have again called on authorities to drop the case.
A November 2015 article claimed Rui Maria de Araujo, as an adviser to the finance minister, had recommended a winning bid for a government supply contract, but misnamed the company. As Oki recounts from the prosecution's case, Araujo believes the article made damaging and incorrect insinuations which hurt his reputation.
Under Timor-Leste press law, Araujo was given a right of reply the following week, and a correction of Oki's report and apology was published the following day.
But in January 2016, Araujo who became prime minister in early 2015 filed a criminal defamation suit and has dismissed subsequent pleas to back down.
"I already said publicly that there was a mistake, we recognised our mistake publicly," says Oki. "I'm not scared but I'm worried about the laws here in Timor-Leste... You don't use the penal code to criminalise the journalists." It is the second time Oki has been charged with a crime over an article.
Jane Worthington, program and development director for IFJ Asia Pacific, says the mistake was dealt with "as is the international standard" and the criminal case was "outrageous".
"It's going to leave a black mark on Timor-Leste and also it just sends a really bad message out to authoritarian regimes who see this as an inspiration that they can lock up journalists for what is effectively criminal defamation," she tells the Guardian.
Worthington says Oki's story is still in the public interest, and the chilling effect on local media would be "debilitating".
"It's quite hypocritical to be on one hand promising the country as a beacon of press freedom, when you could have journalists thrown into jail," says Worthington. "This is not a standard the country can be proud of."
"When Oki and Lourenco from the Timor Post, go to jail, that's the beginning of a new era of the country's leaders killing the free press," he said last week.
Amnesty International says it believes Oki's mistake was made in good faith, and has pointed to the Timor-Leste constitution as well, as domestic and international law which provides for freedom of expression and the press and the protection of journalists.
Because of the court case, Oki was unable to get a visa to Australia to spend time in ABC and Fairfax newsrooms, at the invitation of the ABC and the Department of Foreign Affairs and Trade, and separately, the Australian media entertainment and arts alliance, under the Balibo Five-Roger East Fellowship.
"It was extremely disappointing that because of the charges hanging over his head, that visit was unable to proceed," says MEAA chief executive, Paul Murphy.
"MEAA strongly condemns the use of defamation law to attempt to inhibit media scrutiny in Timor-Leste. This is a backward step for press freedom in the still-young democracy in Timor."
The Guardian has spoken to a number of Timor-Leste government members and bureaucrats who maintain that their country respects press freedom but that Oki broke the law and must face the consequences. None believes there is a problem with the law.
At a speaking event in Darwin earlier this month, former president Jose Ramos-Horta said the country was "100% committed to free media", but had different understandings of the concept.
"Does an individual have a freedom to such an extent that he or she can offend another with innuendo and allegations that are unproven?
"Rui is a man of absolute integrity, and he was angry rightly so when this completely false allegation was printed. The journalist knew it was false so they apologised. Rui said: no this is not enough."
Horta also rejected suggestions Timorese media laws were draconian, and said they were similar to European laws.
The possible jailing of a journalist comes at a crucial time in Timor-Leste's approach to press freedom as it rebuilds a democratic republic following Indonesian occupation.
The country dropped 26 places in the 2015 Reporters Without Borders press freedom index after it adopted media laws which included a requirement that all journalists be formally registered.
The subsequent creation of a statutory press council which would oversee the registrations was tentatively welcomed but its independence has been questioned given it is government-funded and includes two parliamentary nominees.
"The idea of a government-funded body giving approval to who can be a journalist is just a worry," says Worthington. "This should be left to the adjudication of the media industry."
Oki and Martins face court for sentencing next week. The IFJ and others will attend to continue their lobbying and report on the proceedings. The office of Araujo has been contacted for comment.
The International Federation of Journalists (IFJ) has joined its affiliates Media, Entertainment and Arts Alliance (MEAA) and the South East Asia Journalist Unions (SEAJU) in strongly condemning the latest development in the slanderous denunciation case against Timor-Leste journalists Oki Raimundos and Lourenco Martins, reports the IFJ Asia-Pacific bureau.
The IFJ, MEAA and SEAJU have called for the charges to be immediately withdrawn.
The lead prosecutor in the case against Oki Raimundos and Lourenco Martins yesterday put forward the final allegations in the case calling for Oki to be jailed for one year and Martins to be jailed for one year with a further two years suspended sentence. The court will deliver the verdict on June 1 in Dili, Timor Leste.
The allegations against Oki and Martins stem from an article authored by Oki and published by the Timor Post when Martins was the editor-in-chief — in November 2016 which referred to the now Prime Minister of Timor-Leste, Rui Maria de Araujo, in his previous role as adviser to the Minister for Finance.
According to the article published on November 10, Araujo, recommended the winning bid for a project to supply and install computer equipment to the new Ministry of Finance building in 2014.
As outlined under the Press Law, Article 34, the right of reply is guaranteed. As such, the Timor Post published the Prime Minister's reply to the article on the paper's front page on 17 November 2015. The Timor Post then published a clarification of Oki's report in its 18 November 2015 issue.
On April 11, 2016, the Timor-Leste prosecutor began an investigation into the report, after a "slanderous denunciation" lawsuit was filed by the Prime Minister.
The interview was the first step in the process of a decision whether to lay charges against the journalists under the Timorese criminal code.
The IFJ, South East Asian Journalist Unions (SEAJU), Committee to Protect Journalists (CPJ) and Freedom House wrote to the Prime Minister calling for the charges to be dropped. However, he responded to the letter saying: "I will not trade press freedom and freedom of expression with 'press irresponsibility' and 'irresponsible freedom of expression'".
The IFJ and MEAA have advocated on behalf of Oki and Martins to have the charges against them withdrawn throughout the process. Both Oki and Martins have been banned from leaving Timor-Leste without prior permission from the prosecutor.
In 2017, Oki was named as one of the recipients of the Balibo Five-Roger East Fellowship recipients.
Australian barrister and IFJ legal adviser Jim Nolan said: "If the two are convicted this will represent a significant stain on the reputation of democratic East Timor. The case is all the more grave as it involves an article which attacked the Prime Minister.
"The charges have been instituted at his behest. Any decision will also be an encouragement to authoritarian governments in the region which has been marked by increasing attacks upon the press.
"Until these charges emerged, Timor-Leste was one of the few remaining democracies in the region which enjoyed a free press and where journalists could pursue their craft free from the threat of state prosecution."
Jose Belo, former president of the Timor-Leste Press Union (TLPU), said: "The prosecutor's announcement yesterday is a worry for press freedom in Timor-Leste, and puts the press under threat.
"The leaders, the government of Timor-Leste are using the laws that they themselves produced to oppress the media. When Oki and Lourenco from the Timor Post, go to jail, that's the beginning of a new era of the country's leaders killing the free press. We really hope IFJ and journalist friends around the world will help us fight this battle."
MEAA chief executive Paul Murphy said: "This legal assault on an individual journalist is an outrageous over-reach. It uses a draconian law to keep pursuing a journalist long after an error has been acknowledged and the record corrected.
"This law has been condemned by MEAA and many other press freedom groups around the world because it allows the government to pursue, intimidate and silence journalists."
SEAJU said: "SEAJU regrets that East Timor, a country born from a long struggle for freedom, should now suppress one of the most essential freedoms, that of expression, and jump aboard the bandwagon of worsening repression of the press in Southeast Asia."
The IFJ said: "We stand with our colleagues in Timor-Leste in deploring this campaign against them led by the Prime Minister. Slanderous denunciation or criminal defamation by any other name is a brutal attack on press freedom and an attempt to silence critical voices."
Thomas Ora, Dili Timor Leste's new president Francisco Guterres inherits a nation beset by critical problems, including poor education, high employment, and abject poverty.
During a 12-hour inauguration ceremony in the capital Dili on May 20, Guterres popularly known as Lu-Olo vowed to overcome these problems, pursue sustainable development and promote national unity.
In his inaugural speech Lu-Olo, who became Timor-Leste's fourth president - succeeding Taur Matan Ruak - called for the people of Timor-Leste to unite and work to improve their lives.
"Now 15 years after independence, we are facing difficult challenges to liberate people from poverty," he said. "Let's work together to improve the lives of our people," he added.
Poverty in Timor-Leste is decreasing, according to the government, with the national poverty rate having fallen from 50.4 percent in 2007 to 41.8 percent in 2014.
However, the rate is still high with many people still living without electricity or sanitation, malnutrition, unemployment and poor education.
The new president said the country had come a long way since independence 15 years ago but still had a long way to go. One area urgent concern is the poor standard of education
Luis Ribeiro Goncalves, 40, a teacher at Bazartete High School in Liquica district, west of Dili, said schools in his area and in many other districts are in poor condition, lacking facilities and textbooks. "I hope the new president will pay serious attention to these issues," Goncalves said.
He expressed hope the government would provide more money for education on top of this year's $26 million increase from $103 million to $129 million. Timor-Leste's national budget for 2017 was set at $1.3 billion.
Another issue facing Lu-Olo is what to do with the country's petroleum fund, which provides 90 percent of the country's annual budget. The fund was set up to help develop the nation from surplus revenue from oil and gas sales that are expected to run dry in the next few years.
During his speech Lu-Olo also said he would establish a demarcation of permanent maritime and land borders, referring to a long-running dispute with Australia over rights to an estimated US$40 billion oil and gas reserve in the Timor Sea.
However, the new government, according to NGO Lao Hamutuk, needs to reduce its dependency on oil and gas and "develop a non-oil economy, increase domestic revenue and use public funds wisely."
"There is need to capitalize on agriculture and tourism," it said, since the majority of Timor-Leste citizens are farmers. "State budget should be spent more on health, education, agriculture and road construction in rural areas so that farmers can transport their products easily to cities," Adilson da Costa, a Lao Hamutuk researcher said.
Father Julio Crispim Ximenes Belo, head of Dili Diocese's justice and peace commission called for the government not to forget the poor. "The president should push for economic development that does not alienate poor people," Father Belo said.
Although his role is mainly ceremonial, he should be able to create national stability, a condition that enables economic growth, the priest said.
David Hutt On May 19, as dignitaries gathered in Dili for the inauguration of Timor-Leste's new president, Francisco "Lu-Olo" Guterres, the ceremony had an added significance as the new nation celebrated 15 years of independence from repressive and conflict-plagued Indonesian rule.
"We should be proud of so much that has been done during the last 15 years, but we should be aware that there is still much to be done," Lu-Olo said in his first presidential address.
March's presidential election was the first to take place in Timor-Leste, also known as East Timor, without the presence of international peacekeepers, a significant step for Asia's youngest nation. As the small country transitions from conflict to peace, unmistakable progress has been made.
Timor-Leste now outranks many of its neighbors on international measures of good governance and human rights. In the Economist Intelligence Unit's latest Democracy Index, for instance, Timor-Leste ranked higher than any other Southeast Asian country in 43rd place worldwide.
"Timor-Leste is a modern-day miracle: In 15 years, we have been one of only a handful of fragile states to manage to consolidate peace and sustain development," Agio Pereira, Minister of State and government spokesman, told Asia Times.
Lu-Olo's electoral victory was a vote of confidence in Timor-Leste's previous "unity government", formed in 2015 when Xanana Gusmao, leader of the National Congress for Timorese Reconstruction (CNRT), stepped down as prime minister and allowed Rui Maria de Araujo, a member of the rival Fretilin party, to take his place.
Lu-Olo is the president of Fretilin, formally known as the Revolutionary Front for an Independent East Timor, a former armed group fighting for independence from Indonesian rule. That debilitating conflict took between 200,000 to 300,000 lives, or around one-third of the island nation's population.
Critics contend that consensus politics between the two main parties has intensified corruption and nepotism, as well as massive government misspending and a lack of accountability, without an effective opposition in parliament.
Taur Matan Ruak, a former president who is expected to run in July's parliamentary election on the ticket of the newly-formed People's Liberation Party (PLP), is among the government's detractors. He said to parliament last year that the state was "far too centralized" and "excessively wastes resources, allowing thousands of Timorese to become second class citizens."
The country's political divide in some ways boils down to two different concepts of economic development. The "unity government", which commentators believe Gusmao still controls from behind the scenes, favors large-scale infrastructure projects and high levels of government spending.
Opponents, on the other hand, say not enough is being spent on public services and grassroots infrastructure and that large state contracts are being doled out to family members of politicians and an entrenched economic elite.
The former path is arguably unsustainable. Since 2004, the country has earned more than US$18 billion from the Bayu-Undan oil and gas field, the country's largest. The field, however, is expected to run dry as early as 2023.
While there is an estimated US$16 billion in Timor-Leste's sovereign wealth fund, at current levels of state spending it may also be depleted within the next decade, according to independent industry analysts. Approximately 90% of the country's GDP and budget is derived from oil and gas revenues.
The government still hopes to get a better deal from Australia on the Greater Sunrise oil and gas field, though it's not clear Canberra has any intention of amending the 50%-50% revenue sharing arrangement. The Greater Sunrise field's oil and gas resources have been estimated as high as US$53 billion.
Even if Timor-Leste gets its way at the negotiating table, which still appears unlikely, it might not be able to any reap profits from the field for another six or seven years due to high initial investment costs.
The political differences over how best to develop the nation are rooted in history. Once independence was achieved, the government had to quickly establish a new historical narrative to replace the one imposed by Indonesia. The new nationalism thus predictably centered on the struggle for independence.
But when a new bout of violence spread across the country in 2006, police, army and disaffected veterans of the independence struggle were pitted against one another on political lines, a paroxysm that displaced more than 100,000 Dili residents.
Much of the violence was driven by those who felt they had been left out of the country's new start and denied the expected material rewards of independence. When Gusmao became prime minister in 2007, his government responded to the crisis by what some independent analysts dubbed as "buying peace."
"[It] gave rewards to the surrendering 'petitioners', whose desertions from the army had set the  crisis in motion," the International Crisis Group, a Brussels-based conflict resolution outfit, reported.
"[It] offered cash grants to persuade the displaced to return; funded lavish pensions for disgruntled veterans; and put potential spoilers to work pursuant to lucrative construction contracts."
The government also altered the laws on tendering state contracts. All those that met the government's criteria were automatically awarded contracts, even if they were not cost competitive. A decade on, this practice is still thought to continue to placate dissent.
"As a consequence, corruption has set in," Damien Kingsbury, professor of international politics at Australia's Deakin University, recently wrote. "Government tenders were initially overpriced and companies with close connections to senior government members disproportionately benefitted from government business."
Gusmao also appeased Fretilin general-secretary Mari Alkatari, who was forced to resign as prime minister in 2006, by making him the president of the Special Administrative Region of Oecusse, a coastal enclave in the country's western region. The government provides ample funds to run the special economic zone.
"Brother [Gusmao] takes care of Timor while brother [Alkatari] takes care of Oecusse," former president Ruak said last year.
The government grasps the risks of enduring divisions. In 2015, it implemented an initiative known "'National Mourning-End", which, according to commentators, maintained that while the past won't be forgotten, Timor-Leste needs to look ahead for the sake of national development.
That future faces demographic challenges. Between 1999 and 2002, Timor-Leste had one of the world's highest birth rates with around seven births per mother. As a result, almost 60% of the population is currently below the age of 25. With youth unemployment now around 25%, the government is under heavy pressure to create new jobs.
Low corporate tax rates and other incentives have lured some new foreign investments in construction, manufacturing and tourism. But political stability and strong state spending has not yet sparked a virtuous cycle of private sector-led investment and job creation.
The unity government's version of stability will be tested in July's parliamentary election. During his presidential campaign, Lu-Olo won the backing of the CNRT, which was thought to have swung the vote in his favor given that he only received around 30% of votes in the 2007 and 2012 presidential elections.
Second placed Antonio da Conceicao backed by the Democratic Party (DP) and the PLP, both opposed to the "unity government" secured almost 30% of the vote. Some analysts anticipate that result could provide the two opposition parties a solid launch pad into July's parliamentary election.
Although neither party is expected to win a parliamentary majority, there are suggestions they could win enough to ensure Timor-Leste once again has a functioning opposition in parliament and a heartier debate on the country's political direction and economic model.
Helen Davidson, Dili National pride is a serious business for Timor-Leste, a young country with a violent history. So on the eve of a presidential inauguration and the 15th anniversary of the nation's independence, the capital Dili is covered in flags. They adorn houses, fences, bikes and cars. They are draped over balconies and the arms of the half-dozen flag sellers on each block.
As the sun sets on Dili, the seaside road fills with cars, bikes and bemos taking thousands to the historic Tasi Tolu, a park on the outskirts of the city that is deeply embedded in the story of Timor-Leste's path to freedom. It is where Pope John Paul II once led a mass in the local language, Tetum. It is also where thousands first rallied against the Indonesian occupation, where thousands more sheltered during political upheaval, and where in 2002 the government formally proclaimed its independence.
Francisco "Lu-Olo" Guterres, a former guerrilla fighter, won the March presidential election in a single round of voting. He is the country's fourth president but its first to come from the nationalist leftwing party, Fretilin, born from the decades-long resistance movement.
The 12-hour inauguration ceremony the first since UN peacekeepers left in 2012 began at 6pm. During inexplicably long pauses, the crowd remained quiet and solemnly respectful of the event, which represents a sovereign freedom won at a great cost.
The military parade across the wide concrete grounds separated the dignitaries and world leaders under awnings draped in the national colours from the thousands of citizens standing in the dusty park or on the back of utes.
Lu-Olo and his predecessor, Taur Matan Ruak, arrived about midnight by motorcade. Speeches and formalities, the bestowing of the Great Necklace of the Order of Timor-Leste, a 21-gun salute, the raising of the flag, a lap of honour in a military jeep, and more than one rendition of the anthem, followed.
Fireworks marked the end of formalities at 3am, before a public concert entertained those who were still awake at dawn.
"We should be proud of so much that has been done during the last 15 years, but we should be aware that there is still much to be done," he told the crowd.
He indicated that his administration would push Timor-Leste on to the world stage, fostering relationships and defending its hard-won sovereignty.
"I will follow with particular attention and interest the process to establish demarcation of our permanent maritime and land borders with our neighbouring countries, Australia and Indonesia," he said, referencing the long-running and frequently bitter dispute with Australia now before the Hague over rights to an estimated $40bn oil and gas reserve in the Timor Sea.
Domestically, he pledged sustainable development, political stability, national unity, and action on violence against women and children, and poverty.
Nona and Angelina Fernandez, 19-year-old twins who grew up learning of the troubles that began before they were born and continued until they were young children, stayed most of the night.
"I remember this independence, and now I am going to see our new president so we can welcome him," said Nona. "And so he can see how we are going to support our leaders... For me, the president is very important in my life."
Another woman, 22-year-old Melania, said she hoped the new leader would make education a priority. "I believe he can build a good nation and be a better president for our country," she said.
The presidency is largely ceremonial but is influential and seen as a figure of unity. Lu-Olo's election after two previous unsuccessful attempts was assisted by the backing of the CNRT leader, Xanana Gusmao, a beloved former president and political kingmaker.
The 62-year-old is a veteran guerrilla commander and was president of the national parliament following independence.
Jose Ramos Horta, the independence leader and former president and prime minister, has previously told the Guardian the country is not so tied to its revolutionary heroes as observers suggest, but at least for those who attended the inauguration, freedom fighters are the obvious choice to now take the country through its adolescence.
Andre Rangel Gomes said they had a "moral responsibility to make a contribution to the nation". "It's important because their contribution for all these years show these people really are here to contribute to the nation building."
Gomes, who told the Guardian he was a survivor of the 1991 Santa Cruz massacre when Indonesian forces shot and killed at least 250 Timorese pro-independence demonstrators said Lu-Olo's most important task was to maintain stability for Timor-Leste.
Josera de Costa, a public servant, also noted Lu-Olo's guerrilla past, and said he was very happy to be at the inauguration. "As leaders of the country they have a lot of experience. The younger generation need more preparation for the future," he said.
"Lu-Olo has to do everything to make people's lives better in this nation. Access to education, electricity, sanitation, water, housing for people."
Nona said: "I want my president to see all these people who are poor people. To make the roads go to the village, and see how poor all the people still are far from the city."
Poverty in Timor-Leste is decreasing, but remains a way of life for about one-third of the population. In 15 years, the country has come far but as Lu-Olo notes, it still has far to go.
Parliamentary elections will be held in coming months and Ruak is expected to run with his newly formed Peoples Liberation party.
Should the PLP win, Ruak will follow in the footsteps of several predecessors who have held the presidency and prime ministership, including Gusmao and Horta.
He will hold more power as prime minister, steering the country through economically dangerous times. The country's leaders acknowledge its precarious over-dependence on oil and gas revenues these contribute between 90% and 95% of the annual US$1.3bn-1.5bn ($1.75bn-$2bn) budget but current reserves are due to run out in the next few years. There is a lot of hope and investment riding on a favourable outcome in the dispute with Australia.
The vice-finance minister, Helder Lopes, told the Guardian before the inauguration that warnings the country could become a failed state were "partially correct" but the government was well aware of what it needed to do.
More than US$16bn has been funnelled into a sovereign wealth fund, which is partially invested but also heavily utilised in public spending. East Timorese ministers and diplomats are unapologetic about the government's front loaded expenditure on infrastructure, arguing that without good roads, reliable electricity, and fast internet, investors will stay away.
Lopes noted the low 10% corporate tax rate and generous investor incentives as he described his government's hope that Timor-Leste would become a manufacturing and finance hub in the region. He said Timor-Leste was geographically well placed and politically stable, making it an attractive option for foreign investors if the infrastructure was up to scratch.
"The next election is key. If we don't have any problems, I believe we will give a positive signal to private sector investors."
Lucy Marks A program to find and treat children in East Timor with rheumatic heart disease is reducing the rates of heart failure and preventable deaths, researchers say.
For the first time, Australian doctors are working with East Timorese health workers to screen and treat children and young people with the illness, using methods similar to those used in Australia.
After six months of the program, 1,500 children at schools in the capital Dili and the regional district of Emera were tested. About 50 were found to have undiagnosed rheumatic heart disease (RHD).
It is the first time this type of data has been collected in East Timor, and researchers now believe there could be up to 10,000 young people with the illness.
"I feel like we have just reached the tip of the iceberg and there's a whole lot more rheumatic heart disease in Timor Leste than what we've been able to detect with a moderately sized screening program," said Josh Francis from the Menzies School of Health Research. "From my point of view, there's plenty more to do."
A severe case of RHD can result in heart failure and requires life-saving cardiac surgery, but only a select few East Timorese patients can be flown to Australia for the operation.
"We were seeing very severe cases, very much at the pointy end, children who would come into hospital with severe heart failure from severe rheumatic heart disease, and with no real options for cardiac surgery," Dr Francis said. "Tragically we just see many children who die."
The number of deaths from the disease in East Timor are not known because the illness was undocumented until now. "You just see this constant flow of children, young adults with severe rheumatic heart disease," Dr Francis said.
"So I can tell anecdotally of the stories of the children that I've looked after who have died of a result, but the extent of how many die, we really don't know."
A team of health workers supported by Menzies, East Timor's National Hospital, the Bairo Pite Clinic and the East Timor Hearts Fund are conducting a prevalence study, in order to develop a strategy to deal with those who have severe RHD.
The strategy would also seek to prevent severe RHD in those with mild or moderate levels of the illness by treating patients monthly with penicillin injections to stop the progression of the disease.
Health workers are monitoring children who have been identified as having mild or moderate RHD and penicillin is being administered at schools in the villages of Dili and the Emera district.
If the children do not receive the monthly treatment they will have more episodes of acute rheumatic fever and go on to develop more severe RHD.
"They're the ones who... end up with heart failure and possibly even death, and to think that you can stop that simply by giving by penicillin injections, it almost sounds too easy," Dr Francis said. "It really does have the potential to save lives of children whose hearts can be kept healthy."
Dr Francis said a big part of the strategy was to demystify the condition and explain the importance of the painful monthly injections, a task undertaken by local health worker Anary Dos Santos.
"[The success so far] is a real testament to Anary and the way he's communicated with these families and help them understand this is something that can make a real difference to the lives of their children," Dr Francis said.
Mr Dos Santos came to Darwin to learn about the methods used in Australia to track patients and monitor their treatments. He has since set up East Timor's first register to follow patients and collect data, and said the response from the patients was positive.
"If you're close with them and build up your relationship with them then they'll feel more comfortable with you, even the painful, but they feel 'alright because it's important for my health'," Mr Dos Santos said.
"People are saying, 'before I've got this but now I feel a little bit better,, I can run here and there', and I say, 'that's great, it means it [the penicillin] works'."
Dr Francis said he hoped to expand the program to identify more cases and get them on effective prevention.
Paulina Quintao - Executive Secretary of the National Commission for Combating the HIV/AIDS Timor-Leste (KNKS-TL) Daniel Marcal said HIV was a significant threat for the country's human resources in the future.
He said new cases of HIV transmission were increasing among Timor's population, which was at 1,167, 242 million according to the 2016 household census.
He expressed concern that most communities, especially in remote areas, did not have good knowledge or background information about prevention.
"Our culture does not give us the advantage of talking freely to communities about sex education [and] this is a big risk," he said at the prevention education campaign at the Ministry of Interior.
He said the language barrier was another big problem faced by the commission when raising awareness in rural communities because many people did not have a good level of understanding of Tetum or English.
"It is very difficult for us to explain to communities about the human reproductive system and its function using mother tongue [languages] and we have a limited vocabulary in Tetum also," he said.
However, he said the commission continued to make efforts to explain to communities about HIV transmission and prevention methods.
He said the commission also planned to sign a MoU with its Indonesian counterpart to launch a campaign in high risk areas along the border between the two countries.
Based on national data from the Ministry of Health, 600 people were registered as HIV positive and 75 people died between 2003 and July 2016. However, that number had increased to 642 cases and 80 deaths by the end of December 2016.
Of those 642 cases, 60% were aged between 25 and 44, 28% were between the ages of 15 and 24, while 8% were aged over 45, 3% under 5 years of age and 1% were aged between 6 and 14.
Meanwhile, head of the Ministry of Health's HIV/AIDS Program Dr Frederico Bosco said everyone had a responsibility to protect themselves from the virus.
"Even if the ministry may has a good policy in place, if no-one takes steps to prevent the virus then it is difficult to combat it," he said.
He therefore called on those who already had a good knowledge about HIV to share information with others so that more people were aware of the risks.
Although there is no cure for HIV, he said there were now drugs available at health facilities across the country which helped to extend life expectancy.
Paulina Quintao MPs continue to arrive late for parliamentary sessions, according to observations made by the Judicial System of Monitoring program (JSMP).
Based on article 46 in the parliament regime, plenary sessions should start at 9am and more than 10 MPs should take part in the forum. However, JSMP observer Mateus Xavier said that in reality the plenary sessions are almost always delayed until 10am because MPs arrive late.
"Sometimes during the discussions on important laws, particularly during the vote for each article, they (MPs) just leave and this shows that they don't comply with the regulations and do not respect the plenary," he told National Parliament.
He said the failure of MPs to take part in the forum often delayed discussions and the approval process, which meant many laws remained pending. "They (MPs) should set a good example for the people who selected them to sit in parliament and not just turn up when they want to," he said.
He said the punctuality was not only an issue in the current legislature and had also affected parliamentary processes in the past. As a result, the number of issues raised at plenary discussions is often reduced in order to speed up discussions and political decisions.
Under the law, it is the parliament's duty to establish laws, monitor and make political decisions through the plenary.
Meanwhile, MP Josefa Alvares Soares Pereira said she was concerned with the situation as there as there was often not enough time to get through all the items for discussion due to plenary sessions starting late.
"It is too late sometimes it takes one-and-a-half hours [to start], so when we have the agenda for debate, particularly to approve the laws, we cannot raise the important issues at the plenary sessions," she said. "We should fix this situation."
President of the CNRT bench Natalino dos Santos Nascimento said MPs arrived late mostly out of habit, but as a politician they should obey the regulations.
However, he said bench presidents only had a coordinating role and did not have the authority to sanction MPs for arriving late.
He said the consequences of MPs constantly arriving late was that there was no time to make political declarations as there were other important issues to prioritise.
Rhiannon Elston In Timor-Leste's western enclave of Oecusse, change is coming fast. Reuban Landos and his family run a tiny village store on the edge of a paddy field.
Vast mountains decorate the horizon, but soon the landscape will have another defining feature a 56-room hotel with six presidential suites is under construction nearby.
Mr Landos supports the development. "It's good for Oecusse Timorese because they didn't have the work," he said. "Now they all have work."
Timor-Leste's new President, former guerrilla fighter Francisco "Lu Olo" Guterres, plans to continue a government strategy of spending on infrastructure, in the hope of attracting tourism and foreign investment.
"We need to have more investment in infrastructure, there is no point bringing tourists to Timor-Leste without more infrastructure," he told SBS World News through a translator.
The new President takes the helm of a country that has made tremendous improvements to development since independence in 2002. But he inherits a dilemma: An economy heavily reliant on oil and gas, and reserves that may run out within a decade.
Mr Guterres is used to fighting for his country, and says he is ready to do it again. "Even though I spent 24 years in the jungle fighting for my country, I considered that it wasn't completed," he said. "There is much more to be done."
Oecusse, where Portuguese settlers first landed in Timor, is cut off from the rest of the country, surrounded by coast and the Indonesian border. It's the poorest region in the country. Most of the population survives off subsistence farming, pulling water from wells.
The Timorese government plans to spend $400 million over five years to turn the 815 square-kilometre enclave into a small city, hoping to create a hub for tourism and foreign investment.
Former prime minster Mari Alkatiri is now the head of the Oecusse Special Economic Zone, in charge of development. "The triangle for development is tourism, financial centre and agribusiness industries," he said.
It's a lofty plan that would see an international airport replace the unpaved airstrip that currently serves the region.
An irrigation project has just been completed. New roads, a health clinic and a monument depicting the Portuguese landing are already under construction, while a water park features in longer-term plans.
Regional secretary Arsenio Bano says projects to improve the lives of Oecusse residents are happening alongside development. "We combine the infrastructure construction with the development of agriculture, health and education," he said.
But Charlie Scheiner, from Dili-based think tank La'o Hamutuk, questions the government's priorities. "It's unfortunate that the government focuses on things like institutions, which is important, but it doesn't improve daily lives," he said.
He believes there should be more weight given to areas such as sanitation, education and child nutrition. "This is a very young country and it has tremendous challenges," he said. "We think investing in things that will make people's lives better in the short-term will also help development in the long term."
President Guterres says he will "look into" priorities but will continue to support spending on infrastructure. "The observers do not believe in the capacity of us in developing our country," he said. "We know that we've committed some failures and we learn from our experience."
With a wry smile he adds that the government doesn't draw on its considerable oil money investments without careful consideration. "We don't withdraw money from the petroleum fund to shop for vegetables," he said.
But for Mr Alkatiri, in charge of the staggering Oecusse project, optimism overrides cautious analysis.
He insists there is data to show spending in the region will offer a return for the people of Timor-Leste, but he doesn't know the figures by heart. "I'm not an economist," he said. "I don't use excel paper. I'm using my feeling."
The new President will lead Timor-Leste at a critical juncture. Economic change is inevitable and the decisions made from here could make all the difference to a young nation's future.
Havana The map of Timor Leste has the shape of a crocodile, while the map of Cuba has the shape of a Cayman. Both countries fought long and hard for their independence and continue to fight against neo colonial tendencies. They share the Catholic faith and a common Iberian legacy.
Cuba was one of the first countries in the world to recognize the Independence of Timor Leste in May 20 2002. However, unofficial ties date back to the 1970's with several Timorese leaders visiting Cuba.
In May 2002 Timor Leste gained its independence from Indonesia after 24 years of occupation. An estimated 98 percent of the country's infrastructure was destroyed. The country had less than 30 doctors. Malaria, Dengue, Tuberculosis and other infirmities were quite common.
Seeing the difficulties that the youngest nation on earth was facing then President Fidel Castro met Comandante Xanana Gusmao the father of the fledging nation and Dr. Ramos Horta, then Foreign Minister. The meeting took place on the sides of the 13th Non Aligned Movement in Kuala Lumpur, Malaysia, in 2003.
During the meeting Fidel Castro promised the young state that Cuba would train 1,000 Timorese doctors. He also ordered the deployment of a Cuban Medical Brigade made up of 300 Cuban in Timor Leste. The medical team arrived in 2004, its mission was to help the country s' fledging health system while Timorese doctors were being trained in Cuba.
In 2006 when the country faced a brief political crisis the Cuban doctors were the only foreigners not to be evacuated and remained at their post. They worked in some of the most remote areas of the mountainous country, under rudimentary conditions.
As the years went by, Timor Leste began to prosper and the Timorese government began to assume financial responsibility for the Cuban Medical Brigade.
By January 2017, 911 Timorese were trained by Cuba as medical doctors and 160 Cuban doctors were still working in Timor Leste. Every year more doctors are returning to their country. Fidel Castro's promise has been fulfilled.
While relations between the crocodile and the caiman have been dominated by professional training. In recent years the relationship has become more diversified.
In addition to medical doctors there are now Cuban teachers, agriculture experts, architects, engineers and other experts working in Timor Leste. In 2014, an agreement was signed to built a Labiofan yogurt factory in Timor Leste. While there are plans to open a pharmacological plant in Timor Leste with Cuban assistance. Cooperation in the fields of defense, security, environmental protection and fire fighting is also being considered,
Since its independence Timor Leste has consistently denounced the injustice of the US blockade. Its former President and Nobel Prize winner Joze Ramos Horta was very active campaigning for the release of five Cubans arbitrarily detained in US prisons. Ramos Horta has also nominated the Cuban Medical Brigades for the Nobel Peace Prize.
Relations between the leaders and governments of the two countries are very close and warm. But, perhaps most importantly is the fact that people to people relations are quite close. Cuban doctors and other experts stayed and settled in Timor Leste after finishing their missions. Dozens got married to Timorese and built families.
Their presence has left a cultural mark in Timorese society. For instance there are two Cuban restaurants in the capital Dili. Cuban Reggaeton is very popular among the youths. While the image of Comandante Che Guevara is seen around the country. Painted in walls, posters and T-shirts.
These warm close people to people ties ensure that the relation between the two countries remain brotherly regardless of who is in government. These close ties of mutual respect, friendship and love have ensured and will continue to ensure that the crocodile and the caiman will remain close friends for generations to come. Friendship and love have overcome distance. As the Portuguese saying goes: 'Longe da vista, mas perto do coracao' (Far from sight, but close to the heart).
Helen Davidson in Oecusse and Dili In Timor-Leste's Oecusse province, a band of children wash in the river beneath a multimillion-dollar bridge, yet to open. On a freshly paved road towards a US$9m-plus irrigation project, a young girl hauls a bucket of water out of a ground well.
Across the road from the construction site of a three-star hotel, a young family lives in a small hut from which they operate a store. Augustina, 15, has learned some English and says she wanted to become a doctor.
They are among 70,000 people living in this Timor-Leste community, a remote coastal enclave surrounded by Indonesian West Timor, where the Portuguese landed more than 500 years ago. Like all of Timor-Leste, it was devastated by the Indonesian occupation and the violent withdrawal of forces at the end of last century.
Today, the Oecusse special economic zone hosts one of several Timor-Leste infrastructure projects of breathtaking scale, which the government is hoping will bring economic sustainability before its current lifeline of oil and gas reserves dries up.
Timor-Leste has a very short window in which to achieve its goal. More than 90% of its US$1.3bn-1.4bn ($1.75bn-$2bn) annual budget comes from the petroleum fund a sovereign wealth reservoir of more than US$16.2bn drawn from the Bayu-Undan oil and gas field which is expected to stop producing in the next few years. An ownership dispute with Australia over further reserves in the Timor Sea is in arbitration in the Hague.
The government says tight legislation around the use of the petroleum fund ensures its stability, but also acknowledges the 3% annual spending has been frontloaded to 2022 in order to "improve capabilities" in government and "resolve bottlenecks".
Among other projects around the country, almost $500m in public funds have already been poured into Oecusse's bridge, irrigation dam, a port and what will be Timor-Leste's largest international airport, in the name of economic diversification.
"No development around the world is without risk," says former prime minister and now head of the Oecusse project, Mari Alkatiri. "I do believe that if you don't take a risk you will never have anything."
But observers are concerned about the Hail Mary pass, and watchdog groups have criticised a lack of transparency and accountability, saying there has been no public cost-benefit or risk analysis, and no significant private investment to boost the public funds.
Dili-based organisation Lao Hamutuk has accused the government of focusing on roads, bridges and airports over water, schools and hospitals. Former deputy prime minister Mario Carrascalao, who passed away last Saturday, also criticised the government's big spending before addressing healthcare and social needs for "the small people".
The government says it is doing both. Standing next to the US$9m-plus dam, where shrieking children play in the irrigation channels, Arsenio Bano, the regional secretary for education and social issues in Oecusse, says the administration's initial focus is on basic infrastructure, including roads, water, and electricity, to lift the living standards of the people.
He says electricity has been brought to more than 80% of households already, and 2,000 homes have solar power. The irrigation project will deliver water to 1,100 hectares of rice paddy fields and the homes on them, in an aim to reduce rice imports by 50%.
It is also creating jobs. At the Oecusse store Ruban Lanos, 24, says he is happy because the project has brought employment to the people of Oecusse.
The major construction projects are largely Indonesian-run and Portuguese-supervised with about 70% local workforce, Alkatiri says, but a lack of skilled labour has been an issue and has caused delays.
Lao Hamutuk has visited Oecusse and is sceptical about the 70% figure finding most sites to be primarily staffed by Indonesians and Chinese workers.
An unknown number of families have also been forcibly evicted, according to Dr Silverio Pinto Baptista, the provedor for human rights and justice.
While people benefit from the spread of electricity and water, sanitation and industry, and employment, the investments are primarily to draw foreign investors from the finance, agribusiness, and tourism sectors. "If I open the door tomorrow, I will have investors," says Akatiri in Dili.
Alkatiri says agreements have been signed with Singaporean and Swiss training institutions, and he tells the Guardian there have already been applications from foreign investors and joint ventures to the tune of $100m-$350m, but won't detail what they are.
He later says some airlines have expressed interest, and suggests a casino also, but that would not likely be approved because "people were not ready".
Timor-Leste is already offering attractive incentives to foreign investors including a 10% corporate tax and a "no profit no tax" promise.
Alkatiri says Oecusse offers the comfort of better governance and efficiency than in Dili, without corruption, and Bano says land lease deals could further sweeten the deal to draw companies to Oecusse instead of Dili. Bano predicts the region is five years away from welcoming mass tourism and it needs to be making money within 15 years.
Government leaders look to places such as Bali, and hope Oecusse's future tourism industry emulates it. A number of government bureaucrats and diplomats tell the Guardian that Australia's high-risk travel warning against the country is a particular roadblock.
But the Guardian hears of instances of rushed spending, including the planned rebuild of a monument to the Portuguese arrival. An unfinished amphitheatre sits next to the main statue which is surrounded by parklands. Bano says work has stopped because they don't like how it has turned out and will redo it all, at a cost of $500,000 to $700,000.
Civil society groups have pointed to a lack of transparency around the project, including the far lower reporting requirements for the administration's spending compared with other government departments.
Niall Almond, researcher on natural resources and economy at Lao Hamutuk, says there have been questions around the project since the early stages. "Initially very few details were being published in the state budget about how money was being allocated," he says.
"It's gradually improved in terms of the proposal for spending there is now detailed information about theoretically how the money will be spent but there's not transparency in terms of actual spending."
The government "transparency portal" website gives little beyond top-line figures of money pledged and received.
"We're basically pushing for public cost-benefit analysis, increased transparency so people can actually track where the money is going, and an emphasis on more public consultation than has been done in the past."
Alkatiri says "of course" there was economic analysis done but "the decision is mine" in the end. "I'm not an economist, I don't use Excel paper. I'm using my feelings," he says. "This is a holistic development of a territory. It's going to be a reference for the country."
Alkatiri dismisses the criticisms of civil society groups such as Lao Hamutuk, as coming from groups "unfamiliar with these kinds of things".
Alkatiri says he has had "no time" to release the economic analysis of the project which they were requesting, but insists such work was completed. When asked if he could instead release reports, Alkatiri says yes, but Timorese people didn't like to read.
At a G7+ conference in Dili on Monday, delegates from conflict-affected countries discussed how their respective nations could move from "fragility to resilience", with a particular focus on the Sustainable Development Goals.
UN officials privately express their support for the host nation's plans, given the desperate context. Timor-Leste is the second most oil-dependent country in the world, but its current reserves will run out first. They must try anything to diversify.
And so the level of ambition and cash thrown at projects such as Oecusse is sometimes seen as more brave than reckless, especially by other nations also trying to rebuild after being torn apart by conflict.
With little to no tax for corporations, Timor-Leste may find success as a financial hub or a tax haven. With world-class reefs and beaches both in Oecusse and Timor-Leste main it would be unsurprising if a tourism boom approaches.
In the meantime it treads a fine line between lifting up the more than one third of the population living in post-conflict poverty, and securing the nation's economic future. Topics
Lisa Martin Australian peacekeepers led an international force that helped curtail the carnage and bloodshed in the aftermath of East Timor's vote for independence.
Pro-Indonesian militias, with some backing from elements of the Indonesian military, went on a violent looting and arson rampage. An estimated 1500 East Timorese were killed and about 500,000 displaced.
Almost 18 years later, the developing country has joined Australia in honouring the role of peacekeepers in its birth as a nation.
East Timor has donated $US100,000 ($A134,570) towards a memorial recognising Australia's involvement in international peacekeeping operations since 1947.
East Timor Prime Minister Rui Maria de Araujo said the memorial would stand as a testimony of the close bonds that existed between the two nations.
"This memorial will forever speak to the pivotal role of peacekeepers in protecting the most vulnerable and in supporting countries like ours to transition from occupation and conflict to security, stability and peace," he said.
Since 2001, East Timor has halved child mortality, doubled its number of teachers, virtually eliminated malaria, built a sovereign wealth fund and started constructing essential infrastructure.
Hamish McDonald Tolstoy once wrote a short story about a greedy peasant offered as much land as he could get around in a day. The man ran off into the steppe, returning to complete his vast circuit at dusk, only to drop dead from exhaustion.
Tolstoy's parable "How Much Land Does a Man Need?" comes to mind as one of the sorriest chapters in Australia's diplomatic history draws close to resolution: the story of how one of the richest countries in the world with a maritime zone already encompassing a vast stretch of the globe's surface, pressured a much smaller and poorer neighbour into giving it more.
The game seems to be up. While most of us were on holiday in early January, Foreign Minister Julie Bishop slipped out a brief notice that Australia had agreed to begin negotiations with Timor-Leste on a permanent maritime boundary. About the same time, Timor-Leste gave notice it was terminating an existing temporary border and petroleum revenue agreement, known as the treaty on Certain Maritime Arrangements in the Timor Sea, or CMATS.
CMATS was signed with great reluctance by Timorese leaders in 2006 as the best deal in the circumstances. Two months before the newly independent nation came into being in May 2002, the Howard government announced Australia's withdrawal from the jurisdiction of the international courts on maritime boundary issues. So there was no referee.
Meanwhile, Australia had plenty of oil and gas resources and insisted on maintaining a joint development zone worked out with Timor-Leste's Indonesian occupiers in 1989. Time was on its side. Timor desperately needed the Woodside Petroleum consortium's Greater Sunrise gas field in the disputed zone. It caved in, accepting a split of 50:50 in the eventual Greater Sunrise revenues instead of its 18 per cent share under a previous treaty, with fishery rights thrown in. A permanent boundary was put off for 50 years.
But even that deal started foundering within four years, as Woodside baulked at the Timorese demand for the gas to be piped across the 3000-metre-deep Timor Trench to a liquefied natural gas plant on its coast. It preferred a floating LNG plant above the gas field, or failing that, a pipeline to Darwin, longer but in relatively shallow water and hence less risky.
It then came out that the Australian Secret Intelligence Service (ASIS) had bugged the cabinet room in Dili in 2004 as negotiations on CMATS proceeded. Last year Timor-Leste took Australia to The Hague over this bad faith, and won, against Canberra's opposition, an order for compulsory conciliation. In January, Timor-Leste invoked a clause requiring a start of Greater Sunrise development within 10 years as the basis for its withdrawal from CMATS.
Conciliation is less than adjudication or arbitration, but still an independent monitor. A five-member panel of maritime law experts, chaired by Denmark's Peter Taksøe-Jensen, is supervising the bilateral negotiations under way in Singapore. The panel aims to draw recommendations "appropriate for an amicable settlement" by September 19.
Both sides are bound by confidentiality, but a high degree of optimism emanates from Timor-Leste that the commission will accept its case for the boundary to be fixed along the median line between the two coasts. Australia's argument for decades has been that the Timor Trench, much closer to the coast of Timor, is the natural boundary between two continental shelves. It's getting harder to argue, as geologists now say Australia's tectonic plate collides with the Indonesian plate north of Timor and the trench is but a ripple. But this would be a largely symbolic victory for Timor-Leste. And for Australia, it would open up a potentially lasting embarrassment with the neighbour it regards as the most critical element in its national security, Indonesia. This is an issue our leaders need to address in a fashion that puts long-term national interest ahead of immediate mercenary gains.
Many of Timor-Leste's supporters would have it that a median line boundary would deliver it Greater Sunrise, enabling Dili to order Woodside to develop the field its way, or hand over to someone such as the Chinese. But getting more or all of Greater Sunrise requires the commission to agree on swinging the eastern lateral boundary of the disputed zone outward.
For 12 years, Dili has been nursing opinions from British and Australian sea-law experts that by taking into account a small island off the eastern end of Timor, discounting lightly populated small Indonesian islands, and fixing on certain bits of Australia's coast, the side boundary could be swung outwards to take in the parts of Greater Sunrise currently in Australia's exclusive economic zone.
It's a perhaps heroic case. But it's also a "huge gamble", as the Australian Catholic University's Frank Brennan, a supporter of Timor-Leste's quest, has pointed out. The Timorese have gone back to their 18 per cent entitlement, and lost their fishing rights, with no guarantee they will get a border adjustment awarding them more than 50 per cent of Greater Sunrise. Then, of course, they would need to get Woodside to proceed with a development plan it regards as uneconomic and technically risky.
Nor is it entirely up to Australia. The eastward expansion of Timor's jurisdiction would require Indonesia's agreement to its small islands being discounted in the geometry, and sections of Australia's seabed rights being transferred to Timor-Leste, rather than Indonesia. It is understood that Jakarta has formally notified the conciliation commission of its interest.
Even setting this complexity aside, a permanent median-line boundary would stick out like a dog's hind leg on the map, reminding Indonesians of how they were "taken to the cleaners" the phrase of Jakarta's chief negotiator and later foreign minister Mochtar Kusumaatmadja when Australia fixed its maritime boundary with Indonesia in 1970-72 on either side of then Portuguese Timor.
As early as November 1965, Canberra knew the Timor Trench argument was a political risk. As noted in a submission to a parliamentary inquiry on relations with Timor-Leste in 2013, by former secretary to the committee on foreign affairs and defence Robert King, then national development minister David Fairbairn argued for the median line, but the Menzies cabinet took the advice of attorney-general Billy Snedden to stake out the bolder claim, which Indonesia had not challenged. "Jurisdiction asserted without challenge constitutes a powerful claim in international law," Snedden said.
Indonesia was then of course in the middle of horrendous political violence, and unlikely to be thinking much about the seabed. By the time foreign minister William McMahon launched boundary negotiations, its experts such as Mochtar were very aware of the tectonic plate science, but were overruled by General Suharto, who wanted a quick agreement to show Indonesia was turning away from Konfrontasi with its neighbours and grateful for Australia's support for his new regime.
After the annexation of Portuguese Timor, Canberra also played the diplomatic card as hard as it could with a much cannier Mochtar and his successor as foreign minister, Ali Alatas, parlaying recognition of Indonesian sovereignty over Timor for the joint development zone between the median line and the Timor Trench.
As with the Timor-Leste negotiations, there was some dirty play. Throughout, according to authors Brian Toohey and William Pinwill in their book "Oyster: The Story of the Australian Secret Intelligence Service", ASIS kept Canberra supplied with purloined information on the Indonesian case.
The heritage of the two Billys, Snedden and McMahon, lives on in Australian foreign policy, in the form of the Timor Trench as natural boundary. Whether our leaders sincerely believe in it, there seems to be a feeling it can't be let go. As then foreign minister Alexander Downer said in April 2005: "What Australia doesn't want is to unravel all of our maritime boundaries which have been laboriously negotiated over many years with all our neighbours." The big worry, Downer said on other occasions, was Indonesia.
To its credit, Indonesia has never sought to reopen the border issue with Australia. But it has been mentioned as a grievance by the current armed forces chief, General Gatot Nurmantyo, and the negotiations with Timor-Leste must lead to Jakarta being brought into discussions. "In resolving one maritime boundary dispute with Timor-Leste, Australia will therefore want to ensure that it doesn't create a fresh dispute with its biggest maritime neighbour, Indonesia," Australian National University professor of international law Don Rothwell has pointed out.
What should Australia do? The simplest and most honest solution would be to explore with Indonesia, at the highest levels, a unilateral offer to redraw the boundary in the Timor and Arafura seas along the median line, transferring the rights under whatever existing exploration and development leases granted by Australia in affected areas.
As Robert King concluded in his inquiry submission: "The Australian government is bound to act in the best long-term interests of Australia, and that is best served by policies that are in accord with international law and equity. A fair border in the Timor Sea is in the best long-term interests of Australia. The current, essentially belligerent, stance taken by the Australian government (which has been taken consistently by all Australian governments since 1965) is contrary to the national interest (though it might be favourable to some particular interests)."
To offset any Indonesian claims for revenues extracted from these leases since 1972, Indonesia would gain the residual Australian share of Greater Sunrise. Most of the partners in the Woodside consortium already have or have had operations in Indonesia and don't seem to be complaining about its petroleum regime.
A maritime boundary fixed according to the best geological and legal principles would be an investment in Australia's relationships with its region. In the short term, it would be a huge boost for the increasingly embattled secular-nationalist government of President Joko Widodo, who has made control and development of the archipelago state's maritime zones a hallmark policy.
When the border was negotiated 45 years ago, Australia seemed abundant in every resource except petroleum and felt it needed every offshore prospect it could grab, while the world's oil companies were rushing into Indonesia's petroleum-rich Java Sea. Now Indonesia is an oil-importing country, and Australia is about to become the world's biggest exporter of LNG. How much gas does a country need?
John Pilger Filming undercover in East Timor in 1993 I followed a landscape of crosses: great black crosses etched against the sky, crosses on peaks, crosses marching down the hillsides, crosses beside the road. They littered the earth and crowded the eye.
The inscriptions on the crosses revealed the extinction of whole families, wiped out in the space of a year, a month, a day. Village after village stood as memorials.
Kraras is one such village. Known as the "village of the widows", the population of 287 people was murdered by Indonesian troops.
Using a typewriter with a faded ribbon, a local priest had recorded the name, age, cause of death and date of the killing of every victim. In the last column, he identified the Indonesian battalion responsible for each murder. It was evidence of genocide.
I still have this document, which I find difficult to put down, as if the blood of East Timor is fresh on its pages. On the list is the dos Anjos family.
In 1987, I interviewed Arthur Stevenson, known as Steve, a former Australian commando who had fought the Japanese in the Portuguese colony of East Timor in 1942. He told me the story of Celestino dos Anjos, whose ingenuity and bravery had saved his life, and the lives of other Australian soldiers fighting behind Japanese lines.
Steve described the day leaflets fluttered down from a Royal Australian Air Force plane; "We shall never forget you," the leaflets said. Soon afterwards, the Australians were ordered to abandon the island of Timor, leaving the people to their fate.
When I met Steve, he had just received a letter from Celestino's son, Virgillo, who was the same age as his own son. Virgillo wrote that his father had survived the Indonesian invasion of East Timor in 1975, but he went on: "In August 1983, Indonesian forces entered our village, Kraras. They looted, burned and massacred, with fighter aircraft overhead. On 27 September 1983, they made my father and my wife dig their own graves and they machine-gunned them. My wife was pregnant."
The Kraras list is an extraordinary political document that shames Indonesia's Faustian partners in the West and teaches us how much of the world is run. The fighter aircraft that attacked Kraras came from the United States; the machine guns and surface-to-air missiles came from Britain; the silence and betrayal came from Australia.
The priest of Kraras wrote on the final page: "To the capitalist governors of the world, Timor's petroleum smells better than Timorese blood and tears. Who will take this truth to the world?... It is evident that Indonesia would never have committed such a crime if it had not received favourable guarantees from [Western] governments."
As the Indonesian dictator General Suharto was about to invade East Timor (the Portuguese had abandoned their colony), he tipped off the ambassadors of Australia, the United States and Britain. In secret cables subsequently leaked, the Australian ambassador, Richard Woolcott, urged his government to "act in a way which would be designed to minimise the public impact in Australia and show private understanding to Indonesia."
He alluded to the beckoning spoils of oil and gas in the Timor Sea that separated the island from northern Australia. There was no word of concern for the Timorese.
In my experience as a reporter, East Timor was the greatest crime of the late 20th century. I had much to do with Cambodia, yet not even Pol Pot put to death as many people proportionally as Suharto killed and starved in East Timor.
In 1993, the Foreign Affairs Committee of the Australian Parliament estimated that "at least 200,000" East Timorese, a third of the population, had perished under Suharto.
Australia was the only western country formally to recognise Indonesia's genocidal conquest. The murderous Indonesian special forces known as Kopassus were trained by Australian special forces at a base near Perth. The prize in resources, said Foreign Minister Gareth Evans, was worth "zillions" of dollars.
In my 1994 film, Death of a Nation: the Timor Conspiracy, a gloating Evans is filmed lifting a champagne glass as he and Ali Alatas, Suharto's foreign minister, fly over the Timor Sea, having signed a piratical treaty that divided the oil and gas riches of the Timor Sea.
I also filmed witnesses such as Abel Gutteras, now the Ambassador of Timor-Leste (East Timor's post independence name) to Australia. He told me, "We believe we can win and we can count on all those people in the world to listen that nothing is impossible, and peace and freedom are always worth fighting for."
Remarkably, they did win. Many people all over the world did hear them, and a tireless movement added to the pressure on Suharto's backers in Washington, London and Canberra to abandon the dictator.
But there was also a silence. For years, the free press of the complicit countries all but ignored East Timor. There were honourable exceptions, such as the courageous Max Stahl, who filmed the 1991 massacre in the Santa Cruz cemetery. Leading journalists almost literally fell at the feet of Suharto. In a photograph of a group of Australian editors visiting Jakarta, led by the Murdoch editor Paul Kelly, one of them is bowing to Suharto, the genocidist.
From 1999 to 2002, the Australian Government took an estimated $1.2 billion in revenue from one oil and gas field in the Timor Sea. During the same period, Australia gave less than $200 million in so-called aid to East Timor.
In 2002, two months before East Timor won its independence, as Ben Doherty reported in January, "Australia secretly withdrew from the maritime boundary dispute resolution procedures of the UN convention the Law of the Sea, and the equivalent jurisdiction of the International Court of Justice, so that it could not be compelled into legally binding international arbitration".
The former Prime Minister John Howard has described his government's role in East Timor's independence as "noble". Howard's foreign minister, Alexander Downer, once burst into the cabinet room in Dili, East Timor, and told Prime Minister Mari Alkatiri, "We are very tough... Let me give you a tutorial in politics..."
Today, it is Timor-Leste that is giving the tutorial in politics. After years of trickery and bullying by Canberra, the people of Timor-Leste have demanded and won the right to negotiate before the Permanent Court of Arbitration (PCA) a legal maritime boundary and a proper share of the oil and gas.
Australia owes Timor Leste a huge debt some would say, billions of dollars in reparations. Australia should hand over, unconditionally, all royalties collected since Gareth Evans toasted Suharto's dictatorship while flying over the graves of its victims.
The Economist lauds Timor-Leste as the most democratic country in southeast Asia today. Is that an accolade? Or does it mean approval of a small and vulnerable country joining the great game of globalisation?
For the weakest, globalisation is an insidious colonialism that enables transnational finance and its camp-followers to penetrate deeper, as Edward Said wrote, than the old imperialists in their gun boats.
It can mean a model of development that gave Indonesia, under Suharto, gross inequality and corruption; that drove people off their land and into slums, then boasted about a growth rate.
The people of Timor-Leste deserve better than faint praise from the "capitalist governors of the world", as the priest of Kraras wrote. They did not fight and die and vote for entrenched poverty and a growth rate. They deserve the right to sustain themselves when the oil and gas run out as it will. At the very least, their courage ought to be a beacon in our memory: a universal political lesson.
Bravo, Timor-Leste. Bravo and beware.
Dili Coffee trees loom over a village in the hills above Dili, the capital of Timor-Leste. Though their fruit has provided income for decades, Alarico Soares De Cruz, the local headman, says the pickings are gradually growing slimmer. Some of the trees are 40 years old, he explains, and ought to be pruned or completely replanted. But doing so would mean sacrificing the next couple of harvests, and no one is eager for that.
This month marks 15 years since Timor-Leste a former Portuguese colony, once known as East Timor regained its independence after a quarter-century of oppressive Indonesian rule. In that time its leaders have stitched together a relatively stable democracy and brought electricity to its remote hamlets. But they have struggled to reduce widespread poverty among the 1m-odd Timorese, or to revive ailing farms. With reserves of oil and gas dwindling, the government is ploughing the country's savings into grand development schemes. But some fear they could lead to ruin. A general election in July provides a chance to change direction, but voters seem unlikely to seize it.
Timor-Leste has pocketed more than $18bn from Bayu-Undan, its biggest oil and gas field, since its first wells were sunk in 2004. But this income looks set to vanish entirely by 2023, as the field runs dry (see chart). Although a sovereign-wealth fund worth around $16bn will provide a cushion, the government has been dipping deep into this capital lately to fund investments. Last year La'o Hamutuk, a dogged local think-tank, warned that at present spending rates the cash pile could evaporate within ten years.
A handful of industries could sustain Timor in the lean years ahead. The most obvious is agriculture. The coffee business provides some income to about a third of all households; coffee is the country's only significant export apart from oil. Yet the government reckons that around a third of the country's coffee trees are unproductive, withered by age and neglect; others yield only a fraction of what should be achievable. Coffee farmers are producing only about a quarter of the quantities that were shipped during the industry's colonial heyday.
Another opportunity is to draw in more tourists. A survey published in 2014 by the Asia Foundation, a charity, found that foreigners mostly diplomats, development workers and their guests were spending about as much on leisure as the country was earning from exporting its coffee. Timor has pristine reefs, unspoilt hillsides and a compelling national story. Peeling away even a tiny fraction of the 4m holidaymakers who visit nearby Bali each year could make a big difference to the country's fortunes.
The government is trying to foster both industries. After some missteps Timor's tourism ministry has cooked up a natty logo and a flashy website. International outfits such as the Asian Development Bank are working to help boost coffee production; some Timorese beans are sold in Starbucks. Fernando Santana of the agriculture ministry says it plans to use a mixture of education and incentives to help farmers rejuvenate some 500 hectares of coffee plants this year.
The problem is that the government is devoting more time and money to a few risky mega-projects than to these worthy but dull schemes. A new port, the country's first public-private partnership, is being built west of Dili. It may gradually cheapen imports but will not immediately boost Timor's home-grown industries. A bigger concern is whether the government will see a return on the hundreds of millions of dollars it is ploughing into a special economic zone (SEZ) in Oecusse, an exclave tucked into the Indonesian half of the island of Timor, for which the business plan remains worryingly vague.
Perhaps the most alarming expense is a corridor of oil refining and exporting facilities being planned just as Timor's reserves are running dry. Spread along the country's south coast perhaps for no other reason than to give several places a share in the supposed income these installations are to be connected by a gleaming and costly new motorway which will bypass existing towns and villages.
The idea is that this new complex will be used, in part, to process the output of Greater Sunrise, a gas field found in contested waters south of Timor which has lain untapped since its discovery in the 1970s. The Timorese government claims that a treaty in 2006, in which it agreed to split the field's revenues equally with Australia, is unfair; after a lengthy standoff, the two countries agreed in January to renegotiate it. But piping the field's bounty to new plants in Timor is likely to be vastly more expensive than using existing Australian infrastructure. And even if Timor-Leste gets most of what it wants from the negotiations, the revenue from Greater Sunrise will only delay the economic reckoning by a few years.
These issues played only a minor role during campaigning for the presidential election, which was held in March. Since 2015 Timor has been run by a coalition comprising its two largest parties, Fretilin and CNRT. The candidate they backed, Francisco Guterres, won easily enough to avoid a second round. Though the media are free and fairly diverse, Timor's poorly educated voters have little grounding in economic matters and broad faith in a generation of leaders seen to have delivered the country from Indonesian occupation. Having witnessed violence as recently as 2006, when competing political factions engaged in lethal skirmishes, Timorese are generally happy that the bigwigs appear to be getting along.
The worry is that this apathy will last beyond parliamentary elections in July, leaving Timor-Leste bereft of meaningful opposition at a critical juncture. Some useful friction could perhaps come from a new party led by Taur Matan Ruak, the outgoing president who, towards the end of his time in office, began to question the government's schemes. The poll in March produced one surprise: voters in Oecusse, site of the woolly but expensive SEZ, chose not to back the government's man. But although these may be indications of an eventual realignment, the chance of an upset in the near term looks small.
Old hands in Dili remain hopeful that Timor's leaders can find a face-saving way to change course. A foreign businessman says that so far this year ministers have been preoccupied with campaigning; in a few months that will change. It is a good sign that Timorese granted scholarships to study abroad are generally choosing to come back home to work. Half of Timorese are under 17 years old, and they will eventually need jobs. As scores of women gather for noisy aerobics classes on Dili's waterfront their backs turned to a rosy twilight the unrest of the past seems a distant memory. But if the economy crashes, it could easily return.