Timor-Leste wants the permanent maritime border between itself and Australia to lie along the median line. This would give sovereign rights to Timor-Leste over the potentially-lucrative Greater Sunrise oil and gas fields. Source: Timor-Leste's Maritime Boundary Office

By Stephen de Tarczynski
MELBOURNE, Australia, Feb 27 2017 (IPS)

Juvinal Dias has first-hand experience of mistreatment at the hands of a foreign power. Born in 1981 in Tutuala, a village in the far east of Timor-Leste, Dias’ family fled into the jungle following the 1975 invasion by Indonesia.

It was during this time, hiding from the Indonesian military, that his eldest sister died of malnutrition.Widely seen to be central to the maritime boundary issue with Timor-Leste is the potentially-lucrative Greater Sunrise oil and gas fields, reported to be worth some 30 billion dollars.

Speaking to IPS from Dili, Timor-Leste’s capital, Dias told of how “the struggle” against the Indonesian occupation had intertwined with his own family’s history. “I heard, as I grew up, how the war affected the family,” he says.

Dias’ father fought against the occupation with FALANTIL guerrillas, the armed wing of FRETILIN (Revolutionary Front for an Independent Timor-Leste) before surrendering in 1979. Up to 200,000 people are believed to have been killed by Indonesian forces or died from conflict-related illness and hunger during the brutal 1975-1999 occupation.

“People saw the Indonesian military as public enemy number one,” says Dias, now a researcher at the Timor-Leste Institute for Development Monitoring and Analysis, known as La’o Hamutuk in the local Tetum language.

But things have changed. Dias says that it is now Australia that provokes the ire of the Timor-Leste public, who regard their southern neighbour as a “thief country” due to its behaviour towards Timor-Leste over disputed territory in the Timor Sea.

Timor-Leste has long-sought a permanent maritime boundary along the median or equidistance line, as is often the norm in such cases where nations’ Exclusive Economic Zones overlap.

For Timor-Leste’s government, concluding a maritime boundary with Australia is linked to the young nation’s long history of subjugation, including its centuries as a Portuguese colony, its occupation by Indonesia and its treatment by Australia.

“The achievement of maritime boundaries in accordance with international law is a matter of national sovereignty and the sustainability of our country. It is Timor-Leste’s top national priority,” said Timor-Leste’s independence hero Xanana Gusmão last year.

Australia argues that its permanent maritime boundary with Timor-Leste should be based on Australia’s continental shelf, like that of the 1972 Australia-Indonesia seabed boundary. Source: Australia’s Department of Foreign Affairs and Trade

Australia, for its part, has repeatedly avoided entering into such negotiations. Instead, it has concluded a number of revenue sharing deals based on jointly developing petroleum deposits in the Timor Sea with both an independent Timor-Leste and Indonesia during the occupation years.

Australia argues that any border with its much smaller neighbour be based on Australia’s continental shelf, which extends well into the Timor Sea, and should therefore be drawn much closer to Timor-Leste. Australia has taken a hard-nosed approach over border negotiations for decades with nations to its north.

Widely seen to be central to the maritime boundary issue with Timor-Leste is the potentially-lucrative Greater Sunrise oil and gas fields, reported to be worth some 30 billion dollars. If the median line was accepted by both sides, Greater Sunrise would likely fall within Timor-Leste’s jurisdiction, potentially providing one of the poorest nations in the region with much-needed revenue.

However, under current arrangements based on a 2006 deal, Australia and Timor-Leste have agreed to equally divide revenue from Greater Sunrise.

But this deal is set to expire on April 10 following Timor-Leste’s January notification to Australia that it was withdrawing from the treaty. Timor-Leste had been calling for this agreement to be scrapped following the 2012 revelations by a former Australian spy that Australia bugged Timor-Leste’s cabinet rooms in 2004 to gain the upper-hand in the bilateral negotiations that eventually led to the 2006 treaty.

Australia has also been criticised for a 2013 raid on the offices of Timor-Leste’s Australian lawyer in which sensitive documents were seized.

While Timor-Leste took Australia to the International Court of Arbitration in April last year in the hope of forcing Australia to settle on a permanent maritime boundary, Australia’s 2002 withdrawal from compulsory dispute settlement procedures under the United Nations Convention on the Law of the Sea meant, according to the Australian government, that Australia was not bound by any decision made by the court.

But in a significant development, Australia announced in January that it would seek to establish a permanent maritime boundary with Timor-Leste by September this year.

Ella Fabry, an Australian activist with the Timor Sea Justice Campaign, says that Australia now has an opportunity to go some way in righting the wrongs of the past by negotiating in good faith with Timor-Leste and agreeing to a border along the median line.

“For Timor-Leste, it could mean literally billions of dollars of extra funding for them that could then go on to fund health, education [and] all of those things that a developing country needs,” she says.

Investment in such areas is indeed needed in Timor-Leste. According to global charity Oxfam, 41 percent of Timor-Leste’s population of 1.13 million people live on less than 1.25 dollars per day and almost 30 percent do not have access to clean drinking water.

Australia’s foreign affairs department identifies high maternal mortality rates and poor nutrition – leading to stunted growth in half of all children under five years – as being among key areas of concern.

Whether negotiations eventually lead to the financial windfall for Timor-Leste that some are predicting remains to be seen. A maritime boundary agreement along the median line is far from certain and there are serious concerns over the viability of a gas pipeline connecting Greater Sunrise to Timor-Leste, not least because it must cross the three kilometre-deep Timor Trough.

For Juvinal Dias, what often gets overlooked in the maritime boundary dispute is his nation’s over-reliance on income from petroleum resources, which, he argues, has led to a lack of investment in the non-oil economy.

“The oil money has dominated everything in Timor-Leste,” he says.

Timor-Leste has earned more than 12 billion dollars from its joint petroleum development area with Australia. It set up a petroleum fund in 2005, the balance of which was 15.84 billion dollars at the end of 2016, down some 1.3 billion since its peak in May 2015.

According to La’o Hamutuk, Timor-Leste’s oil and gas income peaked in 2012 and will continue to fall, with the Bayu Undan field expected to end production by 2020. It has also warned that if current spending trends continue, the petroleum fund itself will run dry by 2026.

This is a serious concern in a country where petroleum revenue has provided some 90 percent of the budget, leading to what Dias describes as “a very dangerous situation”.

He says that while there is a growing awareness in Timor-Leste about the importance of diversifying its economy, there is no time to waste.

“If we can’t manage our economy today, the poverty will be even worse in the next decade,” says Dias.

Juan González (left), a Peruvian, and Luis Monsalve, a Chilean, made friends in the Plaza de Armas in Santiago in spite of the maritime border dispute settled by the International Court of Justice in The Hague. Credit: Marianela Jarroud/IPS

By Marianela Jarroud
SANTIAGO, Feb 3 2014 (IPS)

Juan González and Luis Monsalve come from different backgrounds, but have much in common. González, a 40-year-old Peruvian migrant who has lived for the past eight years in Santiago, and Monsalve, a 63-year-old Chilean, agree that border conflicts never benefit ordinary people.

They both awaited with interest the ruling of the International Court of Justice (ICJ) in The Hague, which on Monday Jan. 27 took a balanced view of both countries’ legal arguments, but ultimately handed over to Lima thousands of square kilometres of ocean previously controlled by Santiago.“There were differences of opinion between the Peruvians and ourselves, but the atmosphere was never charged with hate.” -- Chilean, Luis Monsalve

In Santiago’s Plaza de Armas, where both men work, mobile television crews, journalists and photographers were present that day to observe the reactions of Chileans and Peruvians to the verdict that settled one of Latin America’s pending border disputes.

“We got a piece of sea that is more important to the high-up authorities, because we ordinary Chileans and Peruvians aren’t given a single fish,” González, a vendor of Peruvian food on one side of the Plaza, told IPS on Wednesday Jan. 29.

For Monsalve, who has a small kiosk on the square, the dispute is “a far-off issue” because “our real problems centre on how to feed our families.”

The Plaza de Armas is the geographical centre of the city and the starting point for measuring distances on all Chile’s highways. It is a favourite place for a stroll for many of the 103,624 Peruvian residents who are the main immigrant community in this country.

The ICJ set new bilateral maritime borders and granted Peru some 22,000 square kilometres of what had been a Chilean exclusive economic zone for the previous 60 years.

Chile wanted the maritime boundary to run parallel to the equator for 200 nautical miles (the limit of its territorial waters), while Peru argued the border should be perpendicular to the coast. The newly delineated border runs along the parallel for 80 nautical miles and then extends to the southwest at an equal distance from both coasts.

The ICJ’s decision is regarded as an equitable compromise by both governments.

The waters that were in dispute are fishing grounds for 1,300 artisanal fishers of anchovy, mainly used to make fish meal, but are controlled by a fishing conglomerate owned by Grupo Angelini, the third-largest economic group in the country.

“The ICJ has safeguarded the fishing rights of artisanal fishers, but also those of the large fishing industry, which operates out to about 60 nautical miles” from the coast, economist Claudio Lara told IPS.

“The interests of Chilean fishing, especially the industry, have been protected by the decision,” said Lara, who is in charge of teaching Master’s degrees in economics at the Latin American Postgraduate School at ARCIS University.

Peru declared it had won a victory in the court case that it brought before the ICJ in 2008, while Chile downplayed the loss of some territorial waters by pointing out that the court in The Hague had recognised the 80 nautical miles of existing maritime border.

While ICJ presiding judge Peter Tomka in The Hague read the verdict, which cannot be appealed, dozens of Peruvian migrants and Chilean citizens discussed its ramifications in the Plaza de Armas.

Chile fought against Bolivia and Peru in the War of the Pacific (1879-1883), in which Lima lost the provinces of Arica and Iquique, and Bolivia lost Antofagasta.

Peru was left without the coastal waters that it went to The Hague to claim back, while Bolivia was left without an outlet to the Pacific, which is a dispute yet to be solved.

During the War of the Pacific, Chilean soldiers sacked different areas of Peru, including Lima, looting valuable works of art and books, raping women and burning homes.

However, 130 years later, Chile and Peru have a great deal in common: they are members of the Pacific Alliance together with Colombia and Mexico, and they both belong to several regional and international organisations.

Chilean investments in Peru amounted to 13.6 billion dollars between 1990 and 2013, and Peruvian investments in Chile were eight billion dollars in that period, according to the ProChile (government export promotion) office in Lima.

Hundreds of thousands of people from both countries travel freely across the border zone from Arica in Chile to Tacna in Peru.

Chilean citizens go to clinics and hospitals in Tacna, where health care is cheaper and the staff are friendlier, they say. According to the mayor of Arica, Salvador Urrutia, some 5,000 people a day cross the border, and three times that number on weekends.

Political scientist Francisca Quiroga, a professor at the Chilean government’s Diplomatic Academy, said that beyond the positions taken by states, “today it is citizens who are on the move, creating greater social mobility, and so different points of view come into play, not just that of the nation-state.”

Nowadays, invoking an external enemy is in contradiction with the new forms of conflict resolution proposed by the citizenry, she said.

González, the Peruvian, said the court decision was a good one. “It’s for the best, this way we will not keep fighting,” he said.

“If they had given Peru more, Chileans would have been worse off, and things could have become more serious,” he said.

“Everything was calm and normal,” said Monsalve, the Chilean. “There were differences of opinion between the Peruvians and ourselves, but the atmosphere was never charged with hate.”

They agree that relations between Chileans and Peruvians are cordial. They mingle on the Plaza de Armas, where stalls selling Peruvian fruit and food have been set up.

Quiroga said that citizens have developed other ways of relating to one another, even though states in the region maintain rather rigid positions on sovereignty.

She cited as an example the Union of South American Nations, which “in its founding charter maintains a very restrictive sovereignty principle, on the basis of non intervention in the internal affairs and defence of each nation.”

Chile and Peru both took their political and legal viewpoints to the ICJ, without economic relations being affected, she said.

Lara said that Chileans have invested over eight billion dollars in Peru since the border dispute went to court in 2008.

On Wednesday Jan. 29, at a bilateral meeting held in the framework of the Second Summit of the Community of Latin American and Caribbean States in Havana, presidents Sebastián Piñera of Chile and Ollanta Humala of Peru agreed to implement the ICJ verdict gradually, in a climate of neighbourly cordiality.

In Santiago, González and Monsalve met and talked for the first time, although they work only half a block away from each other. Juan has invited Luis over to his place to eat one day soon, and says he is looking forward to welcoming him.