SECRETARY'S MEETING WITH EAST TIMOR PRESIDENT

C O N F I D E N T I A L STATE 193342

JAKARTA PASS TO DILI

E.O. 12958: DECL: 10/01/12
TAGS: PREL PHUM ENRG EAID ID TT
SUBJECT: SECRETARY'S MEETING WITH EAST TIMOR PRESIDENT
GUSMAO

CLASSIFIED BY EAP ACTING A/S CHRISTOPHER J. LAFLEUR.
REASON 1.5(D).


1. (U) OCTOBER 1, 2002, 1100-1130, SECRETARY'S OUTER

OFFICE.


2. (U) PARTICIPANTS:

UNITED STATES:

SECRETARY POWELL
SPOKESMAN RICHARD BOUCHER
CHARGE D'AFFAIRES SHARI VILLAROSA
EAP DEPUTY ASSISTANT SECRETARY MATTHEW DALEY
S/WCI AMBASSADOR-AT-LARGE PIERRE-RICHARD PROSPER
EXECUTIVE ASSISTANT CRAIG KELLY
EAP/IET DESK OFFICER PETER HEMSCH (NOTETAKER)

EAST TIMOR:

PRESIDENT KAY RALA XANANA GUSMAO
FOREIGN INISTER JOSE RAMOS-HORTA
ADVISOR TO THE PRESIDENT PAULA PINTO
CHARGE D'AFFAIRES CONSTANCIO PINTO


3. (C) SUMMARY: PRESIDENT GUSMAO INFORMED SECRETARY
POWELL ABOUT EAST TIMOR'S PROPOSAL FOR AN INTERNATIONAL
TRUTH AND JUSTICE COMMISSION ON THE 1999 POST-REFERENDUM
VIOLENCE IN EAST TIMOR. THE SECRETARY SAID HE WAS
DISAPPOINTED BY THE VERDICTS THUS FAR RENDERED BY THE
INDONESIAN AD HOC TRIBUNAL IN JAKARTA; ABASSADOR PROSPER
DESCRIBED THE TIMORESE PROPOSAL AS "CREATIVE." GUSMAO
SAID THAT THE BAYU-UNDAN OIL AND GAS FIELD WOULD BEGIN TO
PRODUCE REVENUE BY 2004, BUT THE MUCH LARGER SUNRISE FIELD
WOULD NOT COME ON-LINE UNTIL 2008. THE RESULTS OF
REVENUE-SHARING NEGOTIATIONS WITH AUSTRALIA WOULD
DETERMINE WHETHER EAST TIMOR WOULD BECOME ANOTHER KUWAIT
OR ANOTHER CAPE VERDE. GUSMAO OPINED THAT UNTIL THE
PETROLEUM INCOME CAME ON-LINE, EAST TIMOR WOULD NEED
SIGNIFICANT DEVELOPMENT ASSISTANCE. IN THIS REGARD, HE
THANKED THE U.S. FOR OUR AID, PARTICULARLY THE DEMOCRACY
PROGRAMS, AND SAID THAT HE HOPED THE U.S. WOULD MAINTAIN A
MILITARY PRESENCE IN THE FUTURE, IF ONLY A LIMITED ONE.
GUSMAO ASKED FOR ADDITIONAL ASSISTANCE TO HELP BUILD A
BARRACKS FOR THE EAST TIMOR DEFENSE FORCE. FOLLOWING THE
MEETING, SECRETARY POWELL AND PRESIDENT GUSMAO SIGNED A
STATUS OF FORCES AGREEMENT. END SUMMARY.

EAST TIMOR AFTER INDEPENDENCE
--------------


4. (C) SECRETARY POWELL OPENED BY CONGRATULATING PRESIDENT
GUSMAO ON EAST TIMOR'S ACHIEVEMENTS OVER THE PAST YEAR, AS
WELL AS FOR ITS ACCESSION TO THE UN LAST WEEK. PRESIDENT
GUSMAO SAID THAT WHILE THE HANDOVER OF EXECUTIVE AUTHORITY
FROM THE UN TO THE TIMORESE HAD GONE SMOOTHLY, HE FACED
THE TWIN CHALLENGES OF BUILDING MANAGEMENT CAPACITY IN THE
GOVERNMENT AND FULFILLING THE EXPECTATIONS OF THE PEOPLE.
THE PEOPLE WERE SHOWING A SPIRIT OF UNDERSTANDING ABOUT
WHAT INDEPENDENCE COULD AND COULD NOT DELIVER, BUT THEY
WANTED RESULTS.

INTERNATIONAL TRUTH AND JUSTICE COMMISSION
--------------


5. (C) GUSMAO NOTED THAT EAST TIMOR'S RELATIONS WITH
INDONESIA WERE GOOD, AS EVIDENCED BY FOREIGN MINISTER
RAMOS-HORTA'S UPCOMING VISIT TO JAKARTA TO ATTEND MEETINGS
OF THE SOUTHWEST PACIFIC FORUM AND EAST TIMOR-INDONESIA
JOINT COMMISSION. HOWEVER, GUSMAO SAID, THERE WERE
RESIDUAL ISSUES THAT REMAINED -- GUSMAO HAD BEEN
DISAPPOINTED BY THE VERDICTS THUS FAR AT INDONESIA'S AD
HOC TRIBUNAL ON THE 1999 POST-REFERENDUM VIOLENCE. RAMOS-
HORTA THEN OUTLINED EAST TIMOR'S POSITION ON PROSECUTING
THE PERPETRATORS OF THE POST-REFERENDUM VIOLENCE. THE
FOREIGN MINISTER SAID THAT GIVEN THE TRIBUNAL'S FAILURE,
THE UNIVERSAL CRITICISM IT HAS RECEIVED, AND THE LACK OF
ANY INDICATION THAT IT WOULD DELIVER IN THE FUTURE, THE
INTERNATIONAL COMMUNITY FACED THREE CHOICES. THE FIRST,
TO DO NOTHING, WOULD BE A DISSERVICE TO THE VICTIMS OF THE
VIOLENCE. THE SECOND CHOICE, THE FORMATION OF AN
INTERNATIONAL TRIBUNAL, WAS PROBLEMATIC -- EVEN IF IT
PASSED THE UN SECURITY COUNCIL IT WOULD LACK A STRONG
MANDATE OR ADEQUATE FUNDING. FURTHERMORE, INDONESIA WOULD
BE UNLIKELY TO COOPERATE WITH A TRIBUNAL AND SUCH A
PROCESS COULD SERIOUSLY DAMAGE THE DILI-JAKARTA
RELATIONSHIP.


6. (C) RAMOS-HORTA SAID THAT AFTER EXTENSIVE CONSULTATIONS
IN EAST TIMOR BOTH WITHIN THE GOVERNMENT AND WITH CIVIL
SOCIETY, THE TIMORESE WERE PROPOSING A THIRD OPTION: THE
FORMATION OF AN INTERNATIONAL TRUTH AND JUSTICE COMMISSION
(ITJC). IN THIS SCENARIO, UN SECRETARY-GENERAL ANNAN
WOULD APPOINT A SPECIAL RAPPORTEUR FOR A THREE-MONTH
PERIOD TO STUDY THE ISSUE, GIVING THE INDONESIA AD HOC
TRIBUNAL MORE TIME TO SHOW RESULTS. IF THE AD HOC
TRIBUNAL FAILED TO ACHIEVE CONVICTIONS, THE RAPPORTEUR
WOULD RECOMMEND, AND THE SECRETARY-GENERAL WOULD APPROVE,
THE FORMATION OF AN ITJC WITH THREE-TO-FIVE JUDGES. ONCE
THE JUDGES ISSUE THEIR REPORT, THE SECURITY COUNCIL WOULD
APPROVE IT, AND INDIVIDUAL COUNTRIES COULD TAKE ACTION
AGAINST THE ACCUSED AS THEY SEE FIT. EXAMPLES OF PUNITIVE
ACTION RANGE FROM BILATERAL DEMANDS THAT ACCUSED OFFICERS
BE FIRED FROM THEIR POSITIONS IN THE INDONESIAN MILITARY,
TO A SIMPLE VISA BAN. RAMOS-HORTA SAID THAT UN HIGH
COMMISSIONER FOR HUMAN RIGHTS (AND FORMER UN SPECIAL
REPRESENTATIVE IN EAST TIMOR),SERGIO DE MELLO, LIKED THE
ITJC IDEA AND WOULD SHORTLY SEND A LETTER TO SECRETARY-
GENERAL ANNAN SUPPORTING IT.


7. (C) SECRETARY POWELL SAID THAT WE TOO HAD BEEN
DISAPPOINTED BY THE VERDICTS AT THE AD HOC TRIBUNAL.
AMBASSADOR PROSPER DESCRIBED THE ITJC PROPOSAL AS
INTERESTING, AND CREATIVE IN ITS EMPHASIS ON ESTABLISHING
A PERMANENT RECORD OF TRUTH. HE EXPRESSED OUR WILLINGNESS
TO IMMEDIATELY ENGAGE WITH THE TIMORESE ON THEIR PROPOSAL.

TIMOR GAP
--------------


8. (C) GUSMAO SAID THAT THE BAYU-UNDAN OIL AND GAS FIELD
IN THE TIMOR GAP WOULD BEGIN TO PRODUCE REVENUE IN 2004,
THOUGH IT WAS DIFFICULT TO JUDGE THE AMOUNT OF EARNINGS.
ESTIMATES RANGE FROM $40 TO $200 MILLION, I.E. MORE THAN
THE CURRENT NATIONAL BUDGET. GUSMAO SAID THAT THE MUCH
LARGER SUNRISE FIELD WOULD NOT BE PRODUCTIVE UNTIL 2008,
AND SINCE NEGOTIATIONS WITH AUSTRALIA FOR A REVENUE-
SHARING AGREEMENT WERE NOT YET CONCLUDED, HE WOULD
APPRECIATE THE SECRETARY'S HELP WITH THE AUSTRALIANS.
RAMOS-HORTA SAID THE TIMORESE SAW THE TIMOR GAP ISSUE AS
BIGGER THAN OIL; FOR EXAMPLE, IF AUSTRALIA AGREED TO
ENFORCE TIMOR'S EXCLUSIVE ECONOMIC ZONE, THE TIMORESE
WOULD GAIN SOME $100 MILLION IN FISHERIES REVENUE
ANNUALLY. THE SECRETARY OPINED THAT INTERNATIONAL
ARBITRATION WAS AN OPTION TO CONSIDER, AND MENTIONED THAT
HE WAS IN REGULAR CONTACT WITH HIS AUSTRALIAN COUNTERPART.

DEVELOPMENT ASSISTANCE
--------------


9. (C) GUSMAO SAID THAT UNTIL THE PETROLEUM INCOME CAME ON
LINE, EAST TIMOR WOULD NEED SIGNIFICANT DEVELOPMENT
ASSISTANCE. IN THIS REGARD, HE THANKED THE U.S. FOR OUR
AID, PARTICULARLY THE DEMOCRACY PROGRAMS, WHICH HE SAID
WERE HELPFUL IN PROMOTING A "DEMOCRATIC CONSCIOUSNESS."
GUSMAO SINGLED OUT THE INTERNATIONAL REPUBLICAN AND
NATIONAL DEMOCRATIC INSTITUTES FOR PRAISE, AND NOTED THAT
THE RECENTLY ARRIVED PEACE CORPS VOLUNTEERS WERE A DYNAMIC
GROUP. HE ALSO SAID THAT THE U.S. MILITARY PRESENCE IN
EAST TIMOR, HOWEVER SMALL, WAS GREATLY APPRECIATED, AND
ASKED IF THE STATE OR DEFENSE DEPARTMENTS COULD ASSIST
WITH THE BUILDING OF A MODERN BARRACKS FOR THE EAST TIMOR
DEFENSE FORCE.


10. (C) THE SECRETARY DID NOT RESPOND TO THE BARRACKS
REQUEST.

POWELL