Crisis and Rice in East Timor

East Timor and Indonesia Action Network (ETAN) - April 9, 2007
by Douglas Kammen and S.W. Hayati

Ten months after rioting, the distribution of weapons to civilians and armed clashes between the military and police plunged East Timor into political crisis, the situation in Dili has taken on a dire new face. In mid-February, rice shortages triggered a new wave of violence. In search of rice, angry Dili residents attempted to break into government warehouses in one case looting 700 tons of rice. International peacekeeping forces sent to Timor in last May in response to the onset of the political crisis took to the streets to restore order. Over the course of three days, fifty UN vehicles were stoned, as too were countless more government vehicles. With no rice to be found for sale, anger grew. In late February the government initiated the sale of rice supplied by the World Food Program in Dili and announced that the program would be extended to the rest of the country.


Several days later, however, the already tense situation was exacerbated by a botched military operation ordered by President Gusmão to capture the former Commander of the Military Police, Alfredo Reinado. At the outset of the crisis in mid-2006 Reinado defected from the East Timor Defense Force and was involved in a shoot-out with the military. He was later arrested, then escaped from prison and for months has been at large in the mountains. Several days after the government rice program was initiated Reinado attacked a police station near the Indonesian border, stealing 25 automatic weapons. (He claims that the police gave him the weapons.) President Gusmão then issued a deadline for Reinado to surrender and ordered the international security force to surround Reinado’s hide-out in the town of Same, in the mountains south of Dili. When the deadline passed, the Australian-led force attacked, killing four of Reinado’s followers, but Reinado escaped unharmed.


The combination of rice shortages and the ill-timed military operation have triggered a new round of violence in Dili. While international attention is focused on Alfredo Reinado and youth burning tires on the streets of the capitol, the food crisis continues. Remarkably, there appear to be important links between the two that may affect the ability of East Timor to hold scheduled Presidential elections in April.


Food and Rumors


The rice crisis prompted a slew of rumors and accusations. Dili residents and members of opposition parties charge that the government is withholding rice from the market with plans to use rice distribution as a means of securing a Fretilin victory in the upcoming election. Former Prime Minister Mari Alkatiri, who was forced from office in June 2006, has stated that the rice crisis is a conspiracy intended to cripple the Fretilin-dominated government. Members of the business community have blamed the crisis on shortages in the international market, explaining that East Timor is a low priority for regional rice suppliers who are rushing to fill large orders from both Indonesia and the Philippines, where prices have soared over the past two months.


Timor is no stranger to food insecurity. The period leading up to the start of the rainy season is known as the “hungry season.” In the face of this, Timorese have relied on a combination of rice, corn, root-crops, and when necessary simple belt-tightening. The importance of tubers is best illustrated by the keladi plant: historically this word has been a designation for people who live in the mountains, although in more recent times “kaladi” has come to be applied to people from the western districts of East Timor, with those from the east called “firaku.”


Today, the government estimates that East Timor requires 83,000 metric tons of rice per annum, based on a calculation of only 90 kilograms per capita, as opposed to the figures of between 133 and 149 kilograms per capita used in Indonesia. Of the 83,000 metric tons needed, the Ministry of Agriculture calculates that domestic production is only 40,000 metric tons. This figure may in fact be exaggerated. In the early 1990s rice production in East Timor surpassed 55,000 metric tons for four years in a row, but then fell to an average of 41,000 metric tons per year. Since 1999, however, a combination of factors failure to maintain irrigation systems, migration from rural to urban areas, high costs for inputs, and higher wages suggest that the current estimate of 40,000 metric tons per year is not realistic.


Crisis and Humanitarian Aid


It was against a back-drop of simmering political tensions and accusations of regional discrimination within the new military force that violence erupted in late April 2006. In May armed clashes between the military and the police degenerated into communal rioting framed in terms of a conflict between “kaladi” from the western districts and “firaku” from the eastern districts. Tens of thousands of people in Dili were displaced from their places of residence, many flocking into make-shift camps scattered throughout the city, and even the military base in neighboring Metinaro. An already depressed economy was devastated by the violence. Looters raided shops throughout the city and emptied the rice reserve in the National Logistics Center warehouses in central Dili. One of Dili’s major traditional markets was burned and others stood abandoned. With the disruption of cross-border trade with Indonesia and the suspension of shipping links, vital food imports were temporarily cut-off.


Under the coordination of the Ministry of Labor and Community Reinsertion (MLCR), the United Nations World Food Program together with international NGOs given responsibility for individual camps initiated a massive program to supply rice and other basic foods to registered refugees. By August, MLCR announced that there were 168,000 internally displaced persons (IDPs), half in Dili and half having fled to their home areas. Charges soon surfaced that the number of IDPs was inflated, in part because IDPs were double and even triple registering, in part too because people who had not been displaced had managed to register. Additionally accusations emerged that humanitarian assistance was a major reason people refused to return to their homes.


Official responses to the IDP problem vacillated between encouragement and ultimatums. In August, Minister of Labor Arsenio Bano publicly urged IDPs to return to their homes. A week later, however, following a violent attack on the IDP camp located across the street from UN headquarters, Prime Minister José Ramos-Horta threatened that if refugees did not return home by the end of September he would discontinue the distribution of humanitarian aid. The following month, Ramos-Horta changed his position, declaring that it was not mandatory for IDPs to return home after all. With the onset of the rainy season imminent, the Deputy Head of the new UN mission renewed the call for refugees to vacate the camps. Following on this, President Gusmão and other national leaders set a deadline of 20 November for refugees to return home. Despite these ultimatums the number of IDPs receiving food assistance provided by humanitarian relief agencies remained largely unchanged.


Food Security and Imports


With attention riveted on the ongoing struggles within the national elite and idealistic calls for dialogue and reconciliation, a less noted story was being played out on the food front. In response to the May looting, a number of donor countries promised to provide rice to help restock the national reserve, but this would take time to arrive. In July, the Director for Planning and Emergencies in MLCR told the media that national rice stocks were dangerously low. Two months later a member of parliament suggested that the poor security situation had resulted in a decrease in food imports. The government was clearly concerned. In September, the Ministry of Agriculture announced an ambitious plan to allocate US$14 million for the purchase of domestically grown staple crops to establish a national reserve. (At US$250 per metric ton, if the entire amount was spent on rice this would mean the purchase of 56,000 metric tons far more than the total annual rice crop.) While plans were being formulated, rice supplies would depend on the private sector.


In early October a number of Dili businessmen made shocking public statements that commercial rice stocks in East Timor had been empty for the previous two weeks. Various reasons were cited. Violence in Dili discouraged shippers from agreeing to enter Dili, and fears increased after IDPs from the camp facing the port looted rice from the wharf. The reduction of working hours at the port, which had previously operated 24-hours a day, to a single 8-hour shift, meant that unloading could take three times as long, with fees to be paid for docking more than three days. Prior to the crisis East Timor was ranked very low by the World Bank in terms of time for imports to clear customs; by the second half of 2006 this had become far worse. By October rice prices had soared to US$18 for a 38 kilogram sack, compared to US$12 before the crisis.


Despite the problems faced by importers, rice imports were remarkably robust in late 2006. In October Timor Food TradingCompany imported shipments of 2,050 and 3,600 metric tons of rice from Vietnam, and between 1 November 2006 and 31 January 2007 three companies (Timor Global, Timor Food and Tropical) imported a total of 10,406 metric tons of rice. In addition, the World Food Program continued to import rice to meet humanitarian needs and East Timor received a gift of 1,200 metric tons of rice from Japan. And yet in early February rice became scarce.



Contracts


Meanwhile, the plans for a rice security program, first announced in September, had taken shape, although with significant modifications. The original plan to allocate US$14 million for the Ministry of Agriculture to purchase domestically grown rice was replaced by a program for the Ministry of Development to spend a more modest US$7,590,000 for the purchase of food, with only US$1,021,000 for the purchase of domestic crops and the remainder to be spent in three tranches on the purchase of imported food. Although the possibility of government-to-government agreements was explored, the final program was for contracts to be signed with Dili-based importers.


In separate interviews, two businessmen in Dili who prefer to remain anonymous complained that the first contract in the Ministry of Development’s food security program was granted without a tender. One of them explained: “The Ministry signed a large contract for the purchase of rice with a company in Dili that has not previously imported rice.” These sources claim that this company then turned to a Dili-based rice importer to fill the government contract. In February, Minister of Development Arcanjo da Silva told Timor Post that a company called Landmark had received a contract worth US$3,369,000 for the import of food, including rice. When asked, Landmark stated they it does not import rice. Moreover, Landmark is not one of the companies known to have imported rice between 1 November 2006 and 31 January 2007, and there is reason to believe that the original contract may have been and a new contract granted to Jaime dos Santos, a Timorese businessman with close links to Fretilin.


In early February rice had become scarce throughout East Timor and prices had soared to US$30 and higher for a 38 kilogram sack. On 7 February Prime Minister Ramos-Horta met with the Chinese Ambassador in East Timor to discuss the purchase of 5,000 metric tons of rice to provide for “the hungry population.” Government officials rushed to assure the public that rice imports were on their way. On 8 February, Minister da Silva told Timor Post that the order of rice would arrive in Dili in one week. Two days later the government conducted an audit and found that there was no rice in storage in the country (a mere 2 sacks were found in the Covalima District warehouse), but this was not reported publicly. The following week, a parliamentary commission summoned four local businessmen to ask for clarification about the rice crisis. In addition to the security situation, problems at the port and customs delays, the businessmen told the members of parliament that Indonesia and the Philippines, both of which are facing severe rice shortages, have signed government-to-government agreements with Thailand and Vietnam, which have not yet harvested this year, for the purchase of very large quantities of rice, putting pressure on rice markets and driving up prices. On 19 February, Ramos-Horta told Timor Post that rice imports would not arrive for another two weeks.


Curiously, two days after the Ramos-Horta’s announcement the Minister of Development Arcanjo da Silva told the press that the government anticipates the arrival of 11,000 metric tons of rice in March. On February 25 a ship carrying 3,600 tons of rice ordered by Timor Food, which is owned by Jaime dos Santos, arrived at Dili harbor. Dos Santos has stated that this is part of a total order of 10,000 (or 11,000, depending on sources) tons that he promised to import two weeks ago. Although dos Santos refused to comment, this appears to be the US$3,3 million first contract granted by the government, with the rice going directly into government warehouses.


Creating Crisis


There is concern that in implementing the food security program, the government has purchased rice that would normally have entered the market. Without proper planning or capacity for the immediate channeling of this rice, it has in effect taken rice out of circulation. This possibility has been invoked by no-less than the Minister of Agriculture, Estanislau da Silva (who currently also holds the position of First Vice-Prime Minister). On 9 February 2006 Minister Estanislau da Silva told the Suara Timor Lorosae daily that large amounts of rice had been imported over the previous few months, but that the government has been purchasing this rice for IDPs in Dili and some stores have withheld rice from the domestic market to sell in Indonesia, where prices are higher. There are two different arguments here. The latter that rice is being taken to from East Timor to Indonesia is certainly possible, but no one interviewed in Dili believes that this could be taking place on a large scale. That leaves the first argument: that despite good intentions, the government program, designed in cooperation with the World Food Program, has resulted in taking rice out of the market place, thus triggering the crisis.


While the people of East Timor wait for answers, if not rice, the Minister of Labor has initiated the first phase of a program to sell rice borrowed from WFP at US$0.40 per kilogram. There is concern that the lack of receipts may lead to corruption. Interviews in Dili have found that at least one Dili resident paid US$2.50 for 5 kilograms of rice, a 20% increase over the agreed price. Others queued for hours without making it to the front of the line to purchase rice. Violence is also a serious threat. On February 21 a group in the Villa Verde neighbourhood of Dili opposed to the government plan to sell rice attacked the village head, Andre Fernandes. “They threw a spear at me, though I was not injured, and then they destroyed my house. They said the rice belongs to the people.” He added: “They said that if [government] rice arrives in our neighborhood [to be sold], they will kill me or burn the village office.” Two days later, in East Timor’s second largest city, Baucau, people demonstrated at the Department of Agriculture against the government rice sales, arguing that it should distributed for free. Three UN Police vehicles were damaged and several protesters arrested. MLRC is now planning to extend the sale of subsidized rice from Dili to the districts, raising the specter of further trouble.


Without greater openness on the part of officials, it is not possible to determine with certainty why East Timor is experiencing a severe crisis. What is clear is that the rice shortage is neither a conspiracy intended to discredit the government nor a plan by the government to win the upcoming 2007 election. Instead, all indications are that the Ministry of Development’s food security program has involved a lack of transparency (if not outright corruption), that the state lacks the capacity to channel rice to the population in an equitable and efficient manner, and that by taking rice off the market government purchases may in fact be the primary cause of the crisis.


Reinado and Rice?


That the former Commander of the Military Police would attack a police station in Maliaan, near the Indonesian border, only days after the start of the government program to sale rice is an extraordinary coincidence. Or is it? There are clear links between Alfredo Reinado’s gang of fugitives and opposition groups, particularly the National Forum for Justice and Peace. In late February, individuals reported to be in regular contact with Reinado organized a demonstration about the shortage of rice and called for people from the western districts to come into Dili for a major rally. This was eventually called off and trucks carrying several hundred supporters of the demonstration were escorted out of Dili by the UN Police. Other questions remain: did Reinado go to Maliana with the intention of obtaining weapons, or was his primary purpose to obtain rice from Indonesia, with weapons an added bonus? Or was this simply a ruse to force the government’s hand and trigger a new outbreak of violence? While the government plan to sell rice, if implemented efficiently, threatens to defuse tensions, continuation of rice shortages plays into the hands of groups opposed to Fretilin and the current government.


More remarkable still is that at the height of the rice crisis President Gusmão would order a military operation against Reinado, who has become a surprisingly popular symbol of opposition to Fretilin, particularly in the western districts. When the deadline for surrender passed in the early hours of 5 March and the military operation against Reinado and his followers was initiated in Same, there was shooting in the Villa Verde neighborhood of Dili and several cars were burned. Since then angry youth have burned tires in the streets. Violence has hindered government attempts to continue the sale of rice. A trickle of rice is coming across the border from Indonesian West Timor, with prices are exorbitant. In Dili vendors are selling rice from Thailand as well as sacks from the World Food Program for $1 per kilogram. Meanwhile the government plan to sell rice at $0.40 per kilogram remains hamstrung by inadequate planning, marketing mechanisms that put village heads under tremendous pressure, and ongoing violence.


Desperation


In the countryside rice is extremely scarce and other food stocks running short. Judith Bovensiepen, an anthropologist conducting research in Funar village, in the mountains of Manatuto, explained that the late start to the rainy season this year means that the corn crop is not yet ready for harvest. Unable to purchase rice, hunger has driven villagers to take action. “Normally they do the harvest ritual when most of the corn is ripe. At the moment, however, they are doing the rituals despite the fact that the corn isn’t ripe. They’re doing it because they can’t eat the corn until they’ve done the harvest rituals, in which the ancestors eat first.”


In Dili the cries of hungry children are fuelling anger, even desperation. As a crowd of men gathered near the National Logistics Center, Australian soldiers toting automatic weapons approached a young man who lives nearby for information. He pointed toward a back alley and the soldiers moved along. When asked about the situation, the young father of three explained: “Someone might have been a hero during the struggle for independence, but today he can be a traitor.” Breaking into tears, he said that if he could leave East Timor it would be better to die elsewhere than to live like this in his own country.


Douglas Kammen is a political scientist who has worked in East Timor for more than three years. S.W. Hayati has worked for non-governmental organizations in East Timor since 2000.