Alkatiri gives some basics in economic fundamentals

Soure: FRETILIN Media

Dr Mari Alkatiri is the secretary general of FRETILIN and Timor-Leste's first post-referendum prime minister.

He delivered this 'lecture' at the 2013 parliamentary budget debate on 4 February. On the Coalition Block's (the government) fiscally driven economic growth, he says:

"Inflating the allocation of resources, coupled with the lack of efficiency and effectiveness in its use in the short, and perhaps medium term, can result in an enviable economic growth. 

"But we should have no doubt that this form of political, social and economic intervention also carries with it the flip side, that is: 

1. inflation;
2. an increasing marginalization of Timorese;
3. an asymmetry in development between urban and rural areas;
4. the distortion of our economic and social system;
5. the abuse of power;
6. corruption.

"When the economy is import dependent, we also buy inflation. All precautions are necessary when we inject financial resources in an economy that is still small in nature. If we do so in an excessive way, exceeding the absorptive capacity of the economy itself, we run the risk of causing serious distortions in the market. The most dangerous is when this distortion affects the labor market. As a result labor becomes increasingly expensive and poorer in quality. Productivity and quality are lost."

The 2013 budget was passed in general on 6 February. An English copy of Dr Alkatiri's speech can be downloaded at La'o Hamutuk's website.