Prime Minister, Xanana Gusmao, is facing calls for his resignation amid allegations he personally approved a lucrative contract that benefited his daughter. It is the latest in a series of corruption scandals to hit the country and, if the allegations are proven, could pose serious problems for Gusmao, who has staked his reputation on cleaning up East Timor's bureaucracy and its tender system.
According to documents obtained by Fretilin, Gusmao awarded a $US3.5 million ($4.4 million) contract for rice imports to Prima Foods, a company Fretilin says is partly owned by his daughter, Zenilda. The contract was awarded under a $US45 million Government program to import basic foodstuffs.
Gusmao's Government has faced a steady stream of corruption allegations. It awarded a $US400 million contract to a Chinese Government-owned company to build two power plants without calling for open tenders. Under the deal, East Timor will import expensive and highly polluting heavy oil, even though it is rich in natural gas. The husband of the Justice Minister, Lucia Lobato, was reportedly awarded a lucrative contract to rebuild a prison and supply uniforms for guards. Lobato, who is responsible for the prison system, is suing the journalist who broke the story.
There have also been allegations of dubious contracts awarded to build patrol boats and provide luxury cars to parliamentarians without an open tender.
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