Building resiliency together

This was Dr. Jose Ramos-Horta’s keynote speech during the Asian Forum on Corporate Social Responsibility held Tuesday, September 2, in Makati.

Ladies and gentlemen,

Always a real pleasure to be back in the Philippines – I’ve lost count of how many times I have visited this country that paved the way for the democratization of Southeast Asia. 

I congratulate all in the Philippines for the impressive achievements in the last years, for the peace accord in the South and for the positive social and economic indicators even as we know this country of 100 million continues to face great challenges.

Filipino detractors used to call this country the “sick man” of Southeast Asia or they would say “the problem of The Philippines is that they have too much.”

In our case, we were told by too many over many long years to be “realistic” and simply accept the “irreversibility” of occupation.

But we struggled on, kept our faith, and prevailed over the prophets of doom.

I know many academics from around the world and Asia. When we expected Asian scholars to be more sensitive and respectful, we found out back then and now how Asia, too, has its share of politically bias “academics” of doom, who today wish us ill, simply because we proved them wrong in the past. Now, they are determined to prove that our independence was a “mistake.”

One case in point is an obscure Kuala Lumpur-based academic who in a simplistic essay for Foreign Affairs “on line” came up with two new cases against Timor-Leste (TL):

a. Timor-Leste is quietly becoming a “failed state;” and 

b. because we will be or should be a “failed state” in some foreseable future, Timor-Leste should not be allowed into ASEAN, supposedly an exclusive elite club of successful economies and full-fledged democracies, all being human rights-abiding, where corruption is non-existant, and good governance, transparency, rule of law, prevail. 

Upholding values of human rights and democracy are also enshrined in the ASEAN Charter. This being the case, how many in ASEAN should exit the organization? 

The pseudo-academic based in KL argued that because TL is “too corrupt” it should not join ASEAN, presumably because ASEAN Member States are all corruption-free like Finland, NZ, Norway, etc. If corruption is an argument against membership in ASEAN, how many current Member States should stay in the organization? 

The KL-based “academic” said something intriguing: Timor-Leste is “quietly” becoming a failed State. I presume he meant one saving grace for the Timorese is that we are going down quietly and politely rather than with a bang! 

He paints a rosy picture of the ASEAN club members; while overall ASEAN and Asian economic data looks impressive I am not among those overly optimistic about the future of Asia; for Asia is, in my view, the most dangerous region of the world, with the largest percentage of extremely poor people, the most populated and extracting the most from Mother Nature, exerting the most pressure on a fragile and depleted environment; a region with the most intractable ethnic and religious tensions, land and maritime border disputes; with the largest convention standing armies in the world and with more rival countries posessing nuclear weapons ponting at each other.

I have been out of office since 2012. I served with the United Nations for 18 months in West Africa – in Guinea-Bissau, ending my mission in June this year.

I hold no official position in my country besides the honorific title of “Maun Bot” for some, “Abo” for others. But I get annoyed at the petulance of some Media and pseudo-academics who make quickie trips to my country proclaim themselves “experts” and write up pseudo-academic essays to enrich their meager CV.

‘Learning by doing’

Ladies and gentlemen,

As we all know, there is no lack of theories on what needs to be done to develop communities. Some are idealistic and romantic ideas, others are very interesting yet very academic and theoretical. Then there are those that are so promising but are yet to be tested and confirmed in practice 

Timor-Leste, has had to learn the hard way – “learning by doing it.” 

The “Founding Fathers” of our Nation are those of us in my country who have guided our people from colonial servitude to occupation untill we conquered the “impossible dream.”

This means, in practical terms, we have some relevant experience in community resilience, nation-building, state-building, peace-making and what Timor-Leste has proved is that we are an extremely resilient community.

Geography and history, our individual and community experiences mold us into what we are. Communities living in fragile countries and regions that for centuries have had to struggle to simply survive and in some cases prosper, are the best examples of resilience.

Resilience stems from adversity, whether natural or man-made, where communities learned to manage what nature provides or does not provide; this is the experience for hundreds of years of indigenous peoples all over the world and we have much to learn from these peoples and their accumulated wisdom.

In our case, It has been a long walk from a difficult period in our history to economic growth in just over a decade. Many look to us as a case study of success despite the many existing challenges and lessons learned that I would like to share with you today. Others, the prophets of doom, are not able to find anything good in us.

With our successes but also with our shortcomings and challenges, Timor-Leste’s recent history can contribute to the development of a model for community-building in the twenty-first century.

On partnerships

Ladies and Gentleman, 

We have learned that in order to be developed, a community ought to live in peace, feel safe and enjoy political stability. But long lasting peace, stability and security can only be attained through dialogue, listening, political inclusiveness, social innovation, fostering partnerships and coalitions between government, civil society, communities and the domestic and international private sectors. 

Fourteen years ago we started literally from ashes: communities torn apart, lack of rule of law, no functioning courts, a discredited police, no private sector, no electricity in rural areas, and serious power shortages in the capital Dili.

We had few roads or roads in very precarious conditions, few poorly staffed and poorly equipped hospitals; and Dili, as well as many other villages throughout the country, were partially or completely destroyed.

To illustrate the extent of the destruction, according to the Word Bank, 95% of schools were destroyed in 1999 (Source: Timor-Leste Poverty Assessment, Poverty in a New Nation: Analysis for Action, 2003).

Much has been achieved since then and much needs still to be achieved in order to provide our People with Sustainable and Equitable Development. Allow me to share with you some examples:

State building & political sustainability that emerged from the peace-building process through (i) a patient journey on national reconciliation, (ii) the building and the strengthening of key national institutions, such as the courts and the public administration bodies, and (iii) the improvement of the Timorese legal system to better serve the country’s needs and protect the rights of its citizens set forth in our Constitution.

Most importantly, I would call your attention to the careful strengthening of the political institutions and the democratic system itself. The respect for the legitimate Constitution of Timor-Leste has been paramount.

Indeed, since independence in 2002, we have had Governments that have been elected by the People in actively contested free and peaceful elections. We also have a strong parliament that adopts laws, oversees the executive branch, among other attributions.

In 2012 we held Presidential and Parliamentary Elections, both of which occurred without major incidents. 

We thoroughly reconciled with our largest and mighty neighbor, the Republic of Indonesia, and as friends and neighbors we walked the long walk of building viable democracies and sustainable economies since the end of the dictatorship in 1998-99. 

Inclusive and Equitable Development

The ever Merciful God gave us some modest amount of oil and gas to feed the poor and power the growth of our economy for some decades until we are able to be less reliant on finite fossil fuels for our survival.

And what should we do with this God-given bonus? Learning from the sad stories of many fellow oil and mineral resource-rich countries where people still live in abject poverty as elites squander the revenues, where legions of poor live next door to extreme, ostentatious opulence, we decided to be different.

We decided to manage our modest revenues with integrity, transparency and wisdom so as to serve the cause of the poor and of the disfranchised in our society.

So we set up by Law a Petroleum Fund in 2005 that was modeled on Norway’s sovereign wealth fund to ensure the sustainable use of its revenues over the long term, avoiding waste and corruption.

In less than 10 years the saved revenues from our Petroleum Fund topped US$16.6 billion in June 2014.

Have we reached sustainable and equitable development by now?

No but we believe that we are in the right direction. In the 2014 UNDP Human Development Index, Timor-Leste has moved from a Low Human development to a Medium Human Development country.

The Human Development Index (HDI) for Timor-Leste is a good indicator of the work that has been carried out. The HDI combines life expectancy, education (school enrolment) and gross national income (GNI) to produce a composite measure of human development. In 2013, Timor-Leste is ranked at 128.

This takes Timor-Leste from a Low Human development country to a Medium Human Development Country along with South Africa, India and Indonesia. The progress has been steady.

In 2011 the ranking was 147, in 2012 Timor-Leste was ranked 134 and the ranking is now 128 amongst 187 countries and territories.” 

In addition, Timor‐Leste had had double-digit growth yearly between 2007 and 2012. The Asian Development Bank forecast Timor-Leste’s growth to be 8.5% both in 2014 and 2015. 

Now that you have kindly heard me mentioning some of the achievements please allow me to share with you as well some of the challenges that we face. Indeed, despite the many achievements that we are proud of, there are still many challenges ahead of us.

Challenges to Timor Leste

Timor-Leste is blessed with oil and gas reserves but, according with the UNDP Human Development Report of 2013 close to 40% of our people live below the international poverty line $1.25 (in purchasing power parity terms) a day, based on data from 2009 and 2010 surveys.

Currently our dependency on oil and gas revenues is cause for concern:

• National budget: the Petroleum Fund pays for the majority of expenditure (88% in 2013). Only a small proportion of expenditure is paid for by other domestic revenues. 
• Our Petroleum Fund is currently worth 16.6 billion dollars (figures from 30.06.2014). It is a great help to kick start our economy and build the much needed roads, electricity for all, clean water and sanitation facilities, etc. 

However, going forward, we cannot rely alone on oil and gas revenues to achieve sustainable and equitable development.

Sustainable development requires building a strong local economy that is less dependent on oil and gas revenues. But at the moment:

• At the moment imports are high and exports very low. In 2010, TL exported $41 millions (mainly coffee) and imported $298 millions. In 2012 we exported $76 millions and imported $667 millions. 
• The majority of the population is still living in rural areas (75% of the population) and involved in a subsistence economy, struggling to have: adequate nutrition, access to proper education and health care. To build a sustainable local economy Timor-Leste needs to create employment and self-employment opportunities for our youth; unleash their potential. We are a young nation with a very young population.
• Median age is 19 yrs old (TL census 2010); in the USA the median age is yrs 37 (USA Census 2010); 40% of the population is between 0 yrs and 14yrs (Census 2010);

However, at this point employment opportunities are not yet matching the number of youth entering the job market every year. 

Peace, political stability and security that, at last, we thoroughly enjoy in our country have been the foundation upon which we are building our future. I look very optimistic to the future and to the opportunities that we are now starting to be able to offer, despite all the existing challenges, to our youth. 

Business opportunities in Timor‐ Leste are plentiful. Most consumer goods are imported but many imported products can be produced locally. The private sector however is at best in a nascent stage, and focused on a narrow range of industries.

The overall ease of doing business in Timor‐ Leste has improved but, according to the World Bank, it remains a risky country to invest in. Timor-Leste’s ranks 172 out of a possible 183 countries in the World Bank’s 2014 “Ease of Doing Business” survey. 

This can be attributed to “gaps in land law, land and property registration, leasing and collateral, bankruptcy, licensing, accounting and auditing, competition policy, intellectual property rights, social security, and key sectoral legislation in areas of tourism, manufacturing and trade.”

On achieving peace

Ladies and Gentleman,

Without inclusive economic growth social peace will always be in jeopardy and community building will be unattainable. Social innovation is needed to ensure long lasting and sustainable peace in our young nation.

This can be achieved through investments in Social and Micro Businesses that walk side by side with the government development plans and complementary public investments that will be launched at the national level in terms of infrastructure (roads, electricity, water, deep water port, etc).

But to achieve this, it is not enough to copy examples from other countries. Social innovation is paramount to allow us to achieve inclusive growth which needs take into consideration the local reality.

As I said before, In 2010 Timor-Leste imported close to USD $300 million in goods. Two years later in 2012 we imported USD $667 million.

With many of these products able to be produced locally, there are many business opportunities for the 40% of the population living on less than 0.88 cents per day.

To create jobs for our young and largely unemployed population we must have our own industries so that we do not need to import so many foreign products. We need to start producing local products that Timorese want to buy instead of foreign ones, local products made to good quality standards and at affordable prices.

Often these opportunities may not be attractive to larger businesses, as profit margins may be smaller. But equally these opportunities may have the potential to deliver large social benefits to communities.

Micro and social businesses can then play a vital role in facilitating and directly providing localproducts to the private sector at a cost effective and efficient manner.

Timor-Leste is an amazingly beautiful and young country blessed with petroleum reserves, the best coffee in the world, pristine landscape and beaches, the best diving and the best preserved coral, with at least 300 Coral species and 700 species of fish (Abundant rich marine life)

But peace and development depend on providing jobs and business opportunities for our largely unemployed population, particularly the Youth.

Social Businesses can greatly contribute towards that goal.Social Business is a new dimension for capitalism that can truly transform lives and that is booming all over the world, according to the Professor Muhmmad Yunus.

A social business has to be about overcoming poverty, or one or more problems (such as education, health, technology access, and environment) which threaten people and society, and not about profit maximization.

Social Businesses are financial and economically sustainable, are environmentally conscious and their workforce gets the market wage with better working conditions. The original concept of Social Business was that a private company that would pay back its original investment to the donors/investors and reinvest its profits to fund further innovation and growth that would advance its social goals.

Professor Yunnus believes that two types of Social Businesses have developed:

1.  the original no profit, no loss companies focused on fighting poverty, which pursue the guiding principles mentioned before, but also
2. for-profit business companies owned by the poor or their community and dedicated to a social cause. 

The Social Business model has been tested and implemented and there are many exciting examples of successful ongoing Social Businesses.

The later type of social business serves as inspiration to businesses who wish to operate in a corporate social responsible model, focusing of the triple bottom line of Economic, Environmental and Social Sustainability,

In line with the above, “Poverty Alleviation as a Business” Can poor people make a business with goods and services that are relevant for poverty alleviation and building communities? The answer is Yes!

To make it happen, markets should be created and technologies must be validated, tested and introduced. If a critical mass of demand is created, small private enterprises will emerge to respond to these new business opportunities.

This approach focuses on the creation of a market for products which are useful to the poor and allow them to get out of the poverty trap. Consequently, the focus is not “export marketing ” or ” fair trade ” but how products such as trees, treadle pumps, rope pumps, maize silos, roofing tiles and latrines can make a difference to the poor. In this sense, it is a “product ” approach. Marketing is used to achieve large-scale dissemination and a big reach-out.

The market creation approach to development is a strategy which combines two aims:

1. To supply to poor people useful and affordable products with a high poverty alleviation impact and, 
2. To create a viable business as a private delivery channel, preferably run by poor people. 

The market creation approach to development is a process that exploits a previously unrecognized vast gap in the market place by designing or identifying products which achieve breakthroughs in affordability and are capable of increasing the income and productivity of poor customers significantly. These products are made available to large numbers of poor people through targeted effective mass marketing strategie.

In Timor-Leste we have, a local NGO  that develops social and micro businesses. 

Empreza Di’akmeans “Good Company”. They are building good businesses that defeat poverty,empower people and build peace. Their team is doing ground-breaking work and is changing lives.

What they do is simple and it works. Empreza Diak works with the poorest communities, focusing on products already being produced for self-sustainability.

Their value-added is to provide enhancements and innovations to their production and marketing, including market access and scale, to enable the communities to move beyond self-sustainability. Their great team is drawn mostly from the private and is highly committed to achieving real and long-lasting results. They have developed systems for a range of locally made products, namely dried fish, salt, algae, rubber and coffee.

In the Ikan Diak/good fish example, Empreza Di’ak is working with over 300 fishermen that produce dried fish, assisting them to increase production, providing equipment and training to produce good quality dried fish that can be sold at the local markets and to local institutions. On average, the fishermen’s weekly income has increased from US$ 7 per week to US$ 82.50 per week.

Ladies and gentlemen, this is the story of my country, and the story of how we are building resilient communities.

Peace building and community development has to be grounded in equitable and long lasting economic development supported by a firm coalition between the government, non for profit sector and the private sector.

In closing I wish to go back to my farewell speech as I left office at the stroke of midnight of 19th May 2012. What I said then, I said many times before, and I believe it would be useful to leaders in our region and beyond. I quote from that speech: 

“Among our many achievements, one that is of great value, is the reconciliation among the divided Timorese family. Our Maun Bot Xanana who led us to freedom when all seemed lost, has led this unique reconciliation process with courage, determination and compassion. I am proud of being part of a society that has shown a great heart in resisting the temptation to exercise revenge in the name of justice.

In victory be magnanimous, never seek to humiliate the adversary; if he is on his knees hold his hands and plead with him to rise up, embrace him; walk halfway and meet the vanquished ones, embrace them, invite them to join in a new enterprise of peace, a new future for all. This has been my belief and in many ways this has been our practice since independence.

Over the ages God The Almighty and The Merciful tested our faith and made us endure our own Stations of the Cross. And time and again, at each station and fall, we rose up, stronger and with deeper faith. 

God The Almighty and The Merciful will bless us tonight for the years to come, and bless our kind friends who crossed lands, oceans and heavens to be with us.”

May God, the Almighty and the Merciful, Bless You All, and your loved ones, family and friends. – Rappler.com

 

Dr. Ramos-Horta has been the international voice of the Timorese people. He was awarded the Nobel Peace Prize in 1996 for his role in finding a peaceful solution to the conflict in his country. His contribution in helping take Timor-Leste from violence and devastation to stability and economic growth in just over a decade serves as a model for community-building in the twenty-first century. He is currently the United Nations’ Special Representative and Head of the UN Integrated Peacebuilding Office in Guinea-Bissau.