Health services are linked to education. With no mass training of health workers, services are scarce and expensive. Despite three decades of Australian aid and World Bank programs, Papua New Guinea has shocking infant and maternal mortality figures. There are simply no doctors outside the provincial capitals. PNG has outstanding export performance in oil, gas, gold, copper, and logs. Exports have remained over 40% of PNG's GDP for two decades. But there has been no 'trickle down' in health benefits. If Australia and the World Bank displace the 100 Cuban doctors in East Timor, and send off that nasty 'communist' system that has offered 600 free medical scholarships to young East Timorese, the country's health standards would match that of PNG.
Then there is agriculture and land, still at the core of livelihoods for most poor people. The neoliberal preference here is clear: export oriented cash crops and individual, saleable land title. This is why the World Bank and the Asian Development Bank, after the Asian Crisis and under their 'structural adjustment' programs, backed clear fell logging (disregard their claims of 'sustainable forestry') and oil palm development over more than 2 million hectares in Indonesia; an environmental catastrophe which has trampled on the land rights and livelihoods of forest peoples. Abolition of rice and kerosene subsidies led to food riots in Jakarta.
We can see the results of the neoliberal pattern in Morocco, where land was some years ago rationalised for export crops. People were driven off the land into the cities, and the subsistence sector was damaged. Then European Union barriers to agricultural imports blocked exports, and the country faced food shortages, for the first time.
In Peru under Alberto Fujimori in the 1990s, land holdings under 10 hectares were banned as agriculture was rationalised. Thousands of small farmers were pushed into work for larger farmers, or into coca production. Peru's production of cocaine doubled. In Lima, removal of the subsidy on cooking fuel led to a cholera outbreak, causing 2000 deaths in six months when poor people could no longer afford to boil water or food . In 1991 more than 80% of Peru's population were malnourished.
Public institutions, so important in defining the identity of a new nation, are repeatedly blocked by neoliberal forces. Food security was of deep concern to the East Timorese, when they went to the World Bank in 2000, asking for help to rehabilitate their rice fields, to strengthen their subsistence sector and to establish public grain silos. The World Bank and Australia said no. Agricultural aid was only available for export crops. East Timor was advised to import rice. Despite this, the independent government proceeded to develop its rice industry, without World Bank help.
This ideological commitment to export cash crops explains sustained World Bank, ADB and Australian subsidies to the oil palm industry in Papua New Guinea, even though this industry is dominated by large foreign companies. Small farmers get few benefits from this industry, but suffer substantial environmental costs. Infrastructure development is also focussed on monoculture cash crops.
Often the promise of a 'transition' to a western friendly regime is accompanied by promises of aid and foreign investment, which can bring wider benefits. But here many poor countries face the 'Nicaraguan dilemma'. After getting rid of the Sandinista government in 1990 (with guerilla war and economic blockade), the US reneged on its aid promises and foreign investment failed to materialise. Just because investors are offered tax-free access to a country's resources, does not mean they will come.
So why do the leaders of developing countries participate in neoliberal programs, when they are so damaging for ordinary poor people? One reason is that they have been obliged to cut political deals, for independence. Maintaining the economic status quo, post-apartheid, helps explain the mostly orthodox policies of South Africa's ANC. A second reason is inattentiveness, policy weakness and a desire to accommodate the big powers - some elements of this are now visible in East Timor. But very often leaders (such as Indonesia's Suharto and Peru's Fujimori) enter a business elite themselves, taking commissions, rents and other benefits from cashed up aid and privatisation programs.
The Australian role in undermining East Timorese independence is difficult to see now, with a media barrage influencing the desire to see ourselves as the little country's 'saviours'. We are nothing of the sort. Australian friends of East Timor should recognise the shocking prospects of neoliberal protectorate status, and maintain their support for an independent nation.
