Groups worldwide urge debt-free Timor-Leste not to borrow
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JMM
Sep 8, 2011, 8:35:11 AM9/8/11
to DIASPORA
Contact: Juvinal Dias (La’o Hamutuk/Movimento Kontra Deve),
+670-734-8703, juvinal @ laohamutuk.org
John M. Miller (ETAN), +1-718-596-7668; jo...@etan.org
Groups worldwide urge debt-free Timor-Leste not to borrow
Pending loans could endanger Timor's future
8 September 2011 - Timor-Leste and international organizations today
urged "the government of Timor-Leste to keep the nation debt-free and
refrain from borrowing money from international lenders.... to protect
its future generations."
The groups argue that "Rather than repeat the mistakes of other
developing countries that have struggled with debt during recent
decades, Timor-Leste should learn from their experiences, which often
inflicted great hardships on their people."
The letter warns that, despite Timor-Leste's current petroleum wealth:
"When Timor-Leste's oil and gas run out in less than 15 years, and
debts still must be repaid, Timor-Leste's children and grandchildren
will suffer the consequences."
The letter was initiated by Timor-Leste's Movimento Kontra Deve
(Movement Against Debt, facilitated by La’o Hamutuk) and the U.S.-
based East Timor and Indonesia Action Network (ETAN).
The full text of the statement in Tetum and English with a complete
list of signers can be found at http://www.etan.org/news/2011/08debt.htm
and http://www.laohamutuk.org/econ/debt/2011/11ETANMKDStmt5Sep2011.htm
.
The statement was endorsed by 117 organizations based in 28 countries.
International networks with long experience in opposing onerous debt
on developing countries are among the signers, including: Focus on the
Global South, Jubilee South - Asia Pacific Movement on Debt and
Development, Third World Network and CADTM International (Committee
for the Cancellation of Third World Debt).
Twenty groups in Timor-Leste signed the statement, including the Timor-
Leste Institute for Development Monitoring and Analysis (La’o
Hamutuk), NGO Forum, Student Front, Community Leaders Forum, Haburas
Foundation and ETADEP. Signing organizations from Timor-Leste’s
southeast Asian neighbors include WALHI - Friends of the Earth
Indonesia, Freedom from Debt Coalition Philippines, International
NGO Forum on Indonesian Development (INFID) and EARTH (Ecological
Alert and Recovery Thailand).
Other signers include sustainable development advocates and groups
that have long supported the people of Timor-Leste, such as Jubilee
USA, the International Platform of Jurists for East Timor, Oil Change
International (USA), Aidwatch (Australia), Friends of the Earth U.S.,
Bank Information Center (USA), Tapol (U.K.), CAFOD (U.K.), Japan East
Timor Coalition, and the Free East Timor Foundation (VOT, Utrecht, the
Netherlands).
Income from oil and gas provides 95% of Timor-Leste's state revenue,
making the country the most petroleum-export dependent in the world.
Although Timor-Leste has not yet borrowed funds from other countries
or international financial institutions, the government has passed
several laws to enable borrowing, including the 2009 Budget and
Financial Management Law, as well as revisions to the Petroleum Fund
Law and the new Public Debt Law both passed just two weeks ago. In
early August, the Asia Development Bank posted information on its
website about a proposed $8.15 million loan to Timor-Leste to upgrade
the national road network.
The Movimento Kontra Deve is a coalition of civil society
organizations in Timor-Leste opposed to the country taking out loans.
ETAN (www.etan.org) is a 20-year old U.S.-based group working in
solidarity with the people of Timor-Leste.
Additional background on Timor-Leste and borrowing can be found in
English: http://www.laohamutuk.org/econ/debt/09Borrowing.htm
Tetum: http://www.laohamutuk.org/econ/debt/09BorrowingTe.htm
-end-
Timor-Leste should remain debt-free.
We, the undersigned Timor-Leste and international organizations, urge
the government of Timor-Leste to keep the nation debt-free and refrain
from borrowing money from international lenders.
We do not take this position to hold Timor-Leste back, but to protect
its future generations. Rather than repeat the mistakes of other
developing countries that have struggled with debt during recent
decades, Timor-Leste should learn from their experiences, which often
inflicted great hardships on their people. This is especially
important because of Timor-Leste’s high dependence on exporting non-
renewable oil and gas wealth, a resource which will run out soon.
More than thirty years ago, lenders made loans to developing
countries, creating unsustainable debt and causing the "debt crises"
of the 1980s and 1990s. Today, creditors continue to drain scarce
resources that could have been spent on essential services like health
care, education, water and sanitation. International financial
institutions - like the IMF and the World Bank - forced countries
which owed them money to implement so-called austerity measures,
demanding cuts in public services in order to repay debt. This has
included the privatization of state services like water and
electricity. The poorest and most vulnerable members of society have
been forced to pay more for essential services, and salaries of public
servants have been lowered. Even when loans are made at concessional
interest rates, borrowing countries are often legally obligated to
prioritize debt payments above their people's needs.
Some argue that revenue from Timor-Leste’s oil and gas wealth can
provide a cushion against which to borrow. History proves such
thinking is wrong. The more oil a country produces and the greater its
dependence on petroleum exports, the more debt that country is likely
to accumulate – and Timor-Leste today is the most petroleum-export-
dependent country in the world, with oil and gas providing 95% of
state revenues. Oil prices and interest rates are very volatile and
beyond Timor-Leste’s control, leaving it especially at risk, as
petroleum revenues will decline and interest rates may rise while
loans are still being paid back. When Timor-Leste's oil and gas run
out in less than 15 years, and debts still must be repaid, Timor-
Leste’s children and grandchildren will suffer the consequences.
In most developing countries with oil resources, worsening economic
and development conditions with little long term benefit are the
result, including increased conflict, impoverishment, and corruption.
Timor-Leste should avoid such a tragedy by learning from other’s
experiences, not repeating them.
The Democratic Republic of Timor-Leste began life in 2002 without
owing money to anyone. For the sake of an equitable, prosperous, and
environmentally sound future for today’s and tomorrow’s children Timor-
Leste should remain debt-free. We urge Timor-Leste’s leaders and
international institutions to use other ways to finance the country’s
much-needed development.
Timor-Leste Movimento Kontra Deve (KONDENA)
East Timor and Indonesia Action Network (ETAN), USA
additional signatures here: http://www.etan.org/news/2011/08debt.htm#sign
+670-734-8703, juvinal @ laohamutuk.org
John M. Miller (ETAN), +1-718-596-7668; jo...@etan.org
Groups worldwide urge debt-free Timor-Leste not to borrow
Pending loans could endanger Timor's future
8 September 2011 - Timor-Leste and international organizations today
urged "the government of Timor-Leste to keep the nation debt-free and
refrain from borrowing money from international lenders.... to protect
its future generations."
The groups argue that "Rather than repeat the mistakes of other
developing countries that have struggled with debt during recent
decades, Timor-Leste should learn from their experiences, which often
inflicted great hardships on their people."
The letter warns that, despite Timor-Leste's current petroleum wealth:
"When Timor-Leste's oil and gas run out in less than 15 years, and
debts still must be repaid, Timor-Leste's children and grandchildren
will suffer the consequences."
The letter was initiated by Timor-Leste's Movimento Kontra Deve
(Movement Against Debt, facilitated by La’o Hamutuk) and the U.S.-
based East Timor and Indonesia Action Network (ETAN).
The full text of the statement in Tetum and English with a complete
list of signers can be found at http://www.etan.org/news/2011/08debt.htm
and http://www.laohamutuk.org/econ/debt/2011/11ETANMKDStmt5Sep2011.htm
.
The statement was endorsed by 117 organizations based in 28 countries.
International networks with long experience in opposing onerous debt
on developing countries are among the signers, including: Focus on the
Global South, Jubilee South - Asia Pacific Movement on Debt and
Development, Third World Network and CADTM International (Committee
for the Cancellation of Third World Debt).
Twenty groups in Timor-Leste signed the statement, including the Timor-
Leste Institute for Development Monitoring and Analysis (La’o
Hamutuk), NGO Forum, Student Front, Community Leaders Forum, Haburas
Foundation and ETADEP. Signing organizations from Timor-Leste’s
southeast Asian neighbors include WALHI - Friends of the Earth
Indonesia, Freedom from Debt Coalition Philippines, International
NGO Forum on Indonesian Development (INFID) and EARTH (Ecological
Alert and Recovery Thailand).
Other signers include sustainable development advocates and groups
that have long supported the people of Timor-Leste, such as Jubilee
USA, the International Platform of Jurists for East Timor, Oil Change
International (USA), Aidwatch (Australia), Friends of the Earth U.S.,
Bank Information Center (USA), Tapol (U.K.), CAFOD (U.K.), Japan East
Timor Coalition, and the Free East Timor Foundation (VOT, Utrecht, the
Netherlands).
Income from oil and gas provides 95% of Timor-Leste's state revenue,
making the country the most petroleum-export dependent in the world.
Although Timor-Leste has not yet borrowed funds from other countries
or international financial institutions, the government has passed
several laws to enable borrowing, including the 2009 Budget and
Financial Management Law, as well as revisions to the Petroleum Fund
Law and the new Public Debt Law both passed just two weeks ago. In
early August, the Asia Development Bank posted information on its
website about a proposed $8.15 million loan to Timor-Leste to upgrade
the national road network.
The Movimento Kontra Deve is a coalition of civil society
organizations in Timor-Leste opposed to the country taking out loans.
ETAN (www.etan.org) is a 20-year old U.S.-based group working in
solidarity with the people of Timor-Leste.
Additional background on Timor-Leste and borrowing can be found in
English: http://www.laohamutuk.org/econ/debt/09Borrowing.htm
Tetum: http://www.laohamutuk.org/econ/debt/09BorrowingTe.htm
-end-
Timor-Leste should remain debt-free.
We, the undersigned Timor-Leste and international organizations, urge
the government of Timor-Leste to keep the nation debt-free and refrain
from borrowing money from international lenders.
We do not take this position to hold Timor-Leste back, but to protect
its future generations. Rather than repeat the mistakes of other
developing countries that have struggled with debt during recent
decades, Timor-Leste should learn from their experiences, which often
inflicted great hardships on their people. This is especially
important because of Timor-Leste’s high dependence on exporting non-
renewable oil and gas wealth, a resource which will run out soon.
More than thirty years ago, lenders made loans to developing
countries, creating unsustainable debt and causing the "debt crises"
of the 1980s and 1990s. Today, creditors continue to drain scarce
resources that could have been spent on essential services like health
care, education, water and sanitation. International financial
institutions - like the IMF and the World Bank - forced countries
which owed them money to implement so-called austerity measures,
demanding cuts in public services in order to repay debt. This has
included the privatization of state services like water and
electricity. The poorest and most vulnerable members of society have
been forced to pay more for essential services, and salaries of public
servants have been lowered. Even when loans are made at concessional
interest rates, borrowing countries are often legally obligated to
prioritize debt payments above their people's needs.
Some argue that revenue from Timor-Leste’s oil and gas wealth can
provide a cushion against which to borrow. History proves such
thinking is wrong. The more oil a country produces and the greater its
dependence on petroleum exports, the more debt that country is likely
to accumulate – and Timor-Leste today is the most petroleum-export-
dependent country in the world, with oil and gas providing 95% of
state revenues. Oil prices and interest rates are very volatile and
beyond Timor-Leste’s control, leaving it especially at risk, as
petroleum revenues will decline and interest rates may rise while
loans are still being paid back. When Timor-Leste's oil and gas run
out in less than 15 years, and debts still must be repaid, Timor-
Leste’s children and grandchildren will suffer the consequences.
In most developing countries with oil resources, worsening economic
and development conditions with little long term benefit are the
result, including increased conflict, impoverishment, and corruption.
Timor-Leste should avoid such a tragedy by learning from other’s
experiences, not repeating them.
The Democratic Republic of Timor-Leste began life in 2002 without
owing money to anyone. For the sake of an equitable, prosperous, and
environmentally sound future for today’s and tomorrow’s children Timor-
Leste should remain debt-free. We urge Timor-Leste’s leaders and
international institutions to use other ways to finance the country’s
much-needed development.
Timor-Leste Movimento Kontra Deve (KONDENA)
East Timor and Indonesia Action Network (ETAN), USA
additional signatures here: http://www.etan.org/news/2011/08debt.htm#sign
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