n May 2002, East Timor officially declared itself a sovereign parliamentary democracy, following years of colonization and occupation. A Portuguese colony for 400 years, it gained independence in 1974, but fighting broke out between rival political factions and by early 1975, Indonesia invaded the country and proceeded to occupy it for 24 years. By the time the occupation ended in 1999, approximately 200,000 Timorese and about 20,000 Indonesians were dead. Resistance toward Indonesian rule existed for the entire duration of the occupation, but it wasn't until the 1990s that the opposition movement gained prominence and strength. In 1991, Timorese independence protestors were massacred, an incident that drew international attention. In 1996, independence activists Bishop Carlos Belo and Jose Ramos Horta were awarded the Nobel Peace Prize for their efforts to gain independence for East Timor, and drew worldwide media attention. Three years later after UN-led negotiations with Portugal and Indonesia, a referendum on the status of East Timor was held, and 78.5% of voters chose independence. However, the vote was overshadowed by violent protests of pro-Indonesian militants and a violent campaign began that resulted in the burning of Timorese villages and caused tens of thousands of citizens to flee their homes. Ultimately, in October 1999 the Indonesian parliament voided the occupation of East Timor and began the process of withdrawal. To aid with the country's transition into independence, the United Nations Transitional Administration in East Timor and in August 2001, the first parliamentary elections were held, CNN.com reported.

A parliamentary democracy, East Timor officially restored its independence on May 20, 2002. It is a work in progress, as the country struggles to revive its economy, which is currently the poorest in South Asia, as well as forming a consistent and secure foreign policy. Currently, the government is attempting to form a solid relationship with Indonesia, as well as the United States and its other Southeast Asian neighbors, in order to facilitate trade and economic growth. By building a cordial economic relationship with its neighbors and the US, East Timor hopes to ensure its security in the foreign policy arena as well. According to the U.S. State Department Bureau of East Asian and Pacific Affairs, the lack of urbanization coupled with low literacy, health and income indicators have left East Timor dependent on foreign aid, but its saving grace could be oil and gas reserves. By late 2004, economists predict revenues from the reserves to help the economy pick up. Until that occurs, the country will be faced with the poverty it inherited from the occupation era.

The government is structured into three branches, with an executive branch that has the President as chief of state with a symbolic role and the Prime Minister as head of government. The legislative branch consists of a unicameral National Parliament. For the judicial branch, the Supreme Court of Justice has all judges appointed by the Superior Council for the Judiciary, except for one who is appointed by the National Parliament.

For the experiment in democracy to succeed, the current President and former guerilla leader Xanana Gusmao feels that economic development is crucial, and the need for a consistent system that produces a just outcome for everyone. In March of 2003 when former leaders were charged with crimes against humanity and relations with Indonesia were strained as a result, President Gusmao praised the judicial system for doing its part in the country's development, but warned in an interview with Time Asia, "It will be meaningless if we have all the perpetrators in jail, but the people continue to face infant mortality, endemic and epidemic diseases, without a decent home, without clean water and food."

For East Timor to succeed as a democratic state, law and order must prevail and economic growth must occur. Repairing over 20 years of occupation and oppression is not an easy task, and many of the leaders who fought for their country's independece were killed in the struggle. An article in Time Asia estimated that "of the 1,500 guerillas who survived the war (out of some 27,000), about 600 have been absorbed into the East Timor Defense Force (F.D.T.L.), Timor's new army. The rest were too damaged in body or mind." Of those who are "too damaged" to continue defending their homeland, most are unemployed and live in squalor. The dedication of these soldiers is admirable, as they risked their well-being for a cause without guaranteed success. However, if they, and the citizens whose freedom they fought for continue to go without basic necessities and live in abhorrent conditions, the system of law and order that has prevailed up to this point, could be placed in jeopardy. The biggest uncertainty for the citizens and government in this new democracy is if they can maintain the stability they are experiencing for the next few years. Once revenues from the oil and gas reserves begin to pour in, and trade relations are established through ASEAN membership and agreements with the USA and Australia, the country will be able to develop a more concrete vision for its future. As the world's first new democracy in the 21st century, East Timor has the opportunity to set a precedent for nations who aspire to free markets and individual liberties, and time will tell if it succeeds in its experiment with democracy.