June 26, 2006

Wild celebrations as East Timor PM resigns

By David Fox

DILI (Reuters) - East Timor's embattled prime minister,
Mari Alkatiri, resigned on Monday, saying he would share
responsibility for a political crisis that has gripped Asia's
newest nation for over two months.

There was no immediate word on a replacement, but news of
his departure was welcomed by thousands of people who have been
demonstrating in the capital for the past week.

They cheered and beat drums in celebration as word of his
resignation spread. A convoy of about 200 buses and vans drove
through the seaside capital of Dili, their horns blaring.

Alkatiri said he was stepping down to avoid the resignation
of the nation's popular president, Xanana Gusmao, who had
threatened to quit himself unless the prime minister left

Gusmao said in a statement he had accepted the resignation
and had called for a meeting of the State Council, a
presidential advisory committee, for Tuesday to discuss the
next step.

Alkatiri told a news conference he was quitting "having
deeply reflected on the present situation prevailing in the
country ... assuming my own share of responsibility for the
crisis affecting our country."

He said he would remain as a member of parliament, but
refused to answer questions.

The prime minister has been widely blamed for violence that
erupted in May as fighting within the armed forces spiraled
into rioting, arson and looting in Dili.

The violence ended only with the arrival last month of a
2,700-strong Australian-led peacekeeping force that has
disarmed the army and police and taken responsibility for

Calls for Alkatiri's resignation have been the rallying cry
of protests by thousands of Timorese that peaked in the past
six days after damaging revelations in an Australian news
documentary linked him to a plot to arm a civilian militia.

"The important thing is that the East Timorese fix up these
problems themselves and it does look like they are getting to a
point of resolution," Australian Foreign Minister Alexander
Downer said in Paris.

"You can't expect us to carry the burden of security while
you yourselves sit back in nothing but a state of impasse," he
told Australian television.


One of the country's best-known political figures, Nobel
Peace Prize laureate Jose Ramos-Horta is being touted as a
possible replacement for Alkatiri should Gusmao ask parliament
to form a national unity government to rule until elections due
by May 2007.

But Ramos-Horta told reporters: "I don't want the job but I
would do it if persuaded by all relevant parties.

"There are a number of extremely able and competent people
within Fretilin who would make a suitable prime minister."

Neither Ramos-Horta, who himself had resigned as foreign
and defense minister on Sunday, nor Gusmao -- both urbane and
Western-leaning -- belong to the ruling Fretilin party.

The party is seen in the West as socialist-orientated, a
legacy of the years its leaders spent in exile in Mozambique or
Angola during East Timor's long independence struggle.

Another possible contender for premier is Ana Pessoa,
Ramos-Horta's ex-wife, who is a staunch Fretilin member. Labor
and Solidarity Minister Arsenio Bano is also a possibility.

Ramos-Horta said it would take time to heal the wounds
caused by the violence, and the country should have no shame in
seeking foreign help for as long as it took to return to

"Sovereignty is beautiful -- when you know how to exercise
it properly," he said, adding that he would be even more vocal
in calls for the United Nations to administer elections
scheduled for early next year.

Whoever takes over, many Timorese and potential foreign
investors want to see more done to rebuild the country's
infrastructure and develop projects to create jobs in a country
where unemployment is around 70 percent.

Timor's budget of $415 million is due to be presented to
parliament on June 30.

Although Timor's only export is "boutique" coffee, the
country has potentially vast untapped oil and gas reserves in
the sea that divides it from Australia, and has already earned
hundreds of millions of dollars in exploration rights.