Timor's oil: blessing or curse?

• Author: Neves, Guteriano
• Position: Less of What We Don't Need

Oil has different meanings for different societies. For developed societies like the United States, Japan, and Western Europe, oil is like an addictive drug that people only want more and more of. It enables them to go everywhere. It helps them cook and regulate the temperature of their dwellings. Without oil, people in these societies couldn't sustain their way of life. For these reasons, many countries go to war for the sake of securing access to oil.

However, oil has different significance for developing countries whose economies heavily depend on exporting oil and gas. When oil was discovered in their territory, it was their expectation that oil exports would help to boost their domestic economy through creating jobs, improving human resources, developing the non-oil economy, building infrastructure, and funding other social services. But this has rarely come to pass.

Most countries in the global south that depend on oil have discovered that oil comes with disaster, civil war, foreign intervention, human rights violations, authoritarian regimes, environmental degradation, corruption, social inequality, and endemic poverty. Chad, Nigeria, Angola, Ecuador, and Iraq are only a few of the countries to learn this difficult lesson. Peter Maas in his book Crude: The Violent Twilight of Oil elegantly put it this way: "one of the ironies of oil-rich countries is that most are not rich, that their oil brings trouble rather than prosperity." Christian Aid, in its report Fuelling Poverty: Oil, War and Corruption, found that at the global level, the oil economy is irrelevant to poor people, who have no access to electricity or to cars, and whose fuel comes not from oil but from wood. As Nnimmo Bassey, a Nigerian poet and current president of Friends of the Earth International, once wrote, "We thought it was oil, but it was blood."

Timor's oil

The situation is even more complex in post-conflict countries like Timor-Leste (TL). Indonesia, which occupied TL illegally for decades, signed most of the oil deals with oil companies like ConocoPhilips and Woodside. When TL won its independence in 2002, it had no freedom to make its own decisions about its natural resources. Much of the revenue, which should have belonged to Timor-Leste, was already flowing to Australia and Indonesia.

Moreover, TL's non-oil economic sectors remain very poor, and sturdy public institutions aren't in place. Those that are in place are still fragile, and law enforcement is weak...