'We Are Lucky'.(Jose (Xanana) Gusmo)(Interview)(Brief Article)

Three years ago, Jose (Xanana) Gusmo was a political prisoner languishing in a Jakarta prison. Today he's president of the world's newest nation. His new job may be even harder than leading the armed resistance to Indonesian occupation: East Timor is plagued by massive poverty, a lack of basic infrastructure, an inexperienced civil service and a rudimentary economy. As he prepared for his Inauguration last week, Gusmo spoke to NEWSWEEK's Joe Cochrane in Dili about the challenges ahead. Excerpts:

COCHRANE: Where did the United Nations Transitional Administration in East Timor [UNTAET] succeed and fail?

GUSMO: The main U.N. mission was to eliminate the [governing] vacuum here and establish the structure of power--the administrative structure, the judiciary structure--to prepare this country for independence. That is why we cannot judge achievements in terms of everything that a government must do. Most important for me, the first achievement [was] the establishment of an environment of security and peace. Second, the presence of the international community here [gave us] East Timorese time enough to reconsider, to calm down, to rethink.

Do you think UNTAET could have done a better job?

Not at all. They established an environment that gave confidence to our people. Of course, economic growth is the task of the government, not the task of UNTAET. Our people in the countryside are living in very, very poor conditions. Some people say that after UNTAET leaves, East Timor's economy will come down. We must learn from this. We need to face real problems.

How can you develop East Timor when your only major industry will be oil and ...