Two years after it became the world's newest country, East Timor's gilded hopes are today looking distinctly tarnished. Internal and external pressures are building, hurting the country's attempts to rebuild its society and economy, but the East Timorese are still optimistic.
Thursday marks the second anniversary of the day East Timor took its place among the ranks of the world's independent nations. It was a hopeful moment: the country was basking in international goodwill and it had offshore gas fields to fund development.
But the reality has not been so easy, as international attention has moved to the Middle East and Central Asia. East Timor is in a bad-tempered feud with Australia for control of a large slice of the gas fields; and attempts to bring justice to those responsible for the violence surrounding its birth have been hampered by fears of angering its giant neighbor Indonesia.
East Timor has just 800,000 people, yet for a few weeks in 1999, it dominated world headlines. After almost 25 years of brutal rule by Indonesia, it voted overwhelmingly for independence in a United Nations-run referendum. The reaction of the Indonesian armed forces and militias was swift: East Timor was reduced to smoking rubble.
Attempts to bring those responsible to justice have had mixed results. More than 300 people have been indicted in East Timor, but most are believed to be in Indonesia, and Jakarta has not extradited any of them.
Nick Koumjian, who heads the United Nation's run Serious Crimes Unit, part of the prosecutor general's office in East Timor, says that despite the shortfalls, the effort to prosecute abuse crimes has been valuable.
"We believe that our work in justice for serious crimes goes hand in hand with reconciliation," he said. "The ability of the communities to accept back those who were on the other side during the issue of the independence and referendum is I think somewhat dependent on them believing the worst perpetrators, those who killed and those who raped, are bought to justice."
The East Timor government itself has been somewhat reluctant to anger the country's former masters in Indonesia by pushing for extradition. East Timor officials have played down a recent arrest warrant issued for the former head of the Indonesian armed forces, General Wiranto, who is now a candidate in Indonesia's presidential election.
The tiny country also faces growing social pressure. The country remains one of the poorest in Asia, and young Timorese are unhappy with the pace of progress towards prosperity.
Observers say there were undoubtedly unrealistic expectations after independence, but there is also a feeling that the government has failed to deliver. In riots 18 months ago, the house of the prime minister was burned down.
There also are warnings from the World Bank and other groups that corruption is creeping into the government, providing another source of discontent.
At a recent World Bank meeting, donors promised more money to cover the budget shortfall. But they urged the Timorese and Australian governments to end an acrimonious argument about sharing revenues from gas fields in the waters that separate the two countries.
Jaoquim Fonseca, a policy analyst and lecturer at East Timor's university, says poverty is the greatest challenge for the country.
"Part of the problem with regard to money is that East Timor, having celebrated the second year of its independence, is still fighting to exert its full sovereignty over its territorial water as well as the land, which, aside from issues of sovereignty, has a lot to do with the resource content that area has, which would enormously help East Timor in its economic development," he said.
The two countries are roughly 600 kilometers apart, but Australia wants the maritime border to be drawn at the edge of its continental shelf, which in some places is only 150 kilometers from the Timorese coast.
Under the current agreement, Australia takes 80 percent of the revenues of the most lucrative of the gas fields, the Greater Sunrise field. Canberra is showing little urgency in negotiating a new deal.
Australia has been a major donor to East Timor, and was instrumental in providing international peacekeeping troops after the 1999 vote. But the aid group Oxfam says it has made more money from the temporary deal on the gas fields than it has donated to East Timor.
Despite his country's woes, Mr. Fonseca is an optimist. "I think people are starting to have the space to actually enjoy what it means to be independent and I have all the good feelings for this in a sense that people are then able to concentrate on developing the country though it is difficult for all the challenges that are laying ahead," he said.
Although East Timor faces daunting challenges, Mr. Fonseca believes it is on the right road. Other analysts point out that for 25 years, the country suffered the brutalities of Indonesian rule, and survived that. A few social and economic troubles should not pose an insurmountable problem.