Angry mobs scream and wave placards outside Dili’s government headquarters. Tax hikes, high university fees and unemployment are central characteristics of East Timor’s fledgling republic. The blame is laid squarely at the feet of the new government: "Those people running the country are not aware what the real needs of the country are," declares former governor Mario Carascalao, who has already stepped down in frustration. Progress in parliament is agonisingly slow. Few new laws have been passed, holding back foreign investment, and clouding property rights. The country is left without even a basic legal framework. At the sparkling new courthouse the dock stands empty – judges and prosecutors went on strike, leaving defendants in custody for up to two and a half years. But there is still huge optimism that things can get better: "We are all learning. These five years are important for us. We can improve," vows Xanana Gusmao. Offshore Oil and gas reserves may yet deliver financial independence in that time, but for the moment it’s a fragile democracy.

Produced by ABC Australia