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East Timor's second major transition since independence

East Timor held peaceful elections this weekend, and is set to form a coalition government that helps transform one of the poorest Asian countries to a middle-income country by 2030.

By Correspondent / July 11, 2012

In East Timor, people queue at a polling station during parliamentary elections in Dili on Saturday, July 7.

Lirio Da Fonseca/Reuters

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Dili, East Timor

The party of East Timor’s prime minister won the majority of seats this weekend in peaceful parliamentary elections, paving the way for him to form another coalition government as the country faces its second major transition a decade after independence. 

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The elections come at an important juncture for the impoverished half-island country, which celebrated its 10th birthday May 20. The United Nations mission and police are slated to withdraw by 2013, by which time Australian and New Zealand troops who have been stationed there on a separate peacekeeping mission will have departed. These changes will leave the young democracy standing on its own feet, and perhaps in a better position to pursue its goal of joining the regional bloc known as ASEAN, or the Association of Southeast Asian Nations.

“The next five years are crucial for us,” says former President Jose Ramos-Horta.

The economic stakes are high. The Timorese people are among the poorest in Asia, but the country has ambitious plans to become a middle-income country by 2030.

The country has recently accrued $10 billion to $11 billion in oil and gas revenue, but relies on one field called Bayu Undan – which could run dry as early as 2024 – for some 90 percent of spending. In 2010 East Timor had only $17 million in nonenergy exports to its name, a signal of just how dependent the government is on its oil revenue.

After the parliamentary results came in Tuesday, Kay Rala Xanana Gusmao, the likely next prime minister, appeared confident that the country could achieve its ambitious plans to become a middle-income country by 2030.

He places his hope in potential revenue from an untapped oil and gas field known as Great Sunrise, which, like Bayu Undan, is situated under the ocean between East Timor and Australia. The tapping of it is currently on hold, as East Timor wants to pipe the gas to its south coast, but the companies involved want to set up a floating liquefied natural gas plant instead.

“I believe we will achieve this goal,” Mr. Gusmao says.

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