The existence of the small and at present not economically viable colonial territory of Portuguese Timor to the immediate north of Australia is likely to attract increasing international attention in the near future. It is a subject on which our own attitudes need clarification. The recent change of government in Portugal and the anticipated shift in Portuguese attitudes towards Portugal's overseas territories will be a contributing factor to this, while in Australia our differences with Portugal over the delimitation of the seabed boundary in the area between the Australian and Timor coasts will also focus attention on the present status of Portuguese Timor. [matter omitted]2
- Portuguese Timor was considered by the Caetano Government to be an integral part of Portugal proper, and it did not give any consideration to a change in the status of the Portuguese territories. As we understand it, the attitude of the Spinola Government towards independence for the Portuguese territories is one of progressive self-determination within the Portuguese Federation. However, some of the more radical pressure groups in Portugal are likely to seek a further liberalisation of this policy, particularly towards the African territories. The attitude of the Portuguese Government towards Portuguese Timor will certainly be affected by developments in Guinea Bissau, Mozambique and Angola, although it is probable that if these become independent, Portuguese Timor could assume greater significance in the eyes of the Portuguese Government and a change in its status could then become less likely.
- The attitude of the Portuguese Government will also be affected by its assessment of the future commercial prospects for Portuguese Timor, and in particular for tourism and oil and natural gas. There are good possibilities both for an increase in tourism and the discovery of oil or natural gas deposits (either by an Australian or United States company), and the likelihood of increased revenues would increase the reluctance of Portugal to relinquish control over the territory.
- Portuguese Timor has always been useful to the Portuguese Government as a 'safe' territory for soldiers on national service, as an assignment for recalcitrant government officials, and as a prison, and such rationale for retaining its status would become increasingly valid if the African territories became independent.
- Apart from several minor incidents the administrations in Indonesian Timor and Portuguese Timor have been on good terms.
- In the absence of any significant political agitation in Portuguese Timor or an active liberation movement in Indonesian Timor the Indonesian Government has shown no inclination to interfere with the status quo in Portuguese Timor. They are aware that Portuguese Timor could be an economic liability if it became part of Indonesia, and an important consideration is their desire to avoid giving any appearance of having designs on Portuguese Timor which could fuel suspicion of Indonesian expansionist ambitions among neighbouring countries, particularly Papua New Guinea.
- Indonesia has opposed Portuguese colonialism at the United Nations, and in the long term undoubtedly regards Portuguese Timor as a colonial vestige whose status must eventually change. If a national liberation movement developed that attracted international attention, Indonesia would probably lend material and moral support. Adam Malik was reported as saying to the press on 29 March 1972 in reply to a question on what Indonesia would do if Portuguese Timor developed its own liberation movement: 'We shall finance and support them if they really wish it'. The question was, of course, hypothetical.
- We should recognise that at present Portuguese Timor is not at present a viable economic entity and for this reason and the absence of any local political elite, it would have no capability in the short-term to handle a self-governing or independent status. The logical long-term development is that it should become part of Indonesia.
- The Spinola Government appears unlikely to consider any change of status for Portuguese Timor and our own attitude towards it should continue to be governed by that of Indonesia.3 However, the attitudes of other governments in the United Nations on its status, and the positions assumed by the more liberal groups in Portugal would need to also be carefully considered. (c) In any public references to the future status of the Portuguese territories we should continue to distinguish between the African territories and Portuguese Timor.
- We should press ahead with negotiations with Portugal on the Portuguese Timor seabed boundary, but bear in mind that the Indonesians would probably be prepared to accept the same compromise as they did in the negotiations already completed on the seabed boundary between our two countries. Such a compromise would be more acceptable to us than the present Portuguese position. For precisely this reason however, we should be careful not to be seen as pushing for self-government or independence for Portuguese Timor or for it to become part of Indonesia, as this would probably be interpreted as evidence of our self-interest in the seabed boundary dispute rather than a genuine concern for the future of Portuguese Timor. (e) We should continue to keep a careful check on the activities of Australian commercial firms in Portuguese Timor.
[NAA: Al838, 696/5, ii]