New Timor head calls for sweat, hard work

New East Timor Prime Minister Taur Matan Ruak has called for "sweat and hard work" to lift East Timor out of poverty.

Taur Matan Ruak made the call as he was sworn in as president Sunday hours before the nation celebrated a decade of independence.

Shortly after midnight, the former guerilla fighter took over the presidency from Nobel laureate Jose Ramos-Horta in an emotional ceremony on a beachfront where East Timor had declared its freedom from Indonesia exactly 10 years ago.

"There was a time in the past when blood and fighting spirit was what was demanded from us," the ex-army chief told a nation devastated by decades of conflict, drawing loud applause from thousands gathered at the open-air venue.

"Today, what is required from us is sweat and hard work," the 55-year-old said at the beachfront area of Tasi Tolu on the outskirts of the capital Dili, also the site of a mass celebrated by Pope John Paul II in 1989.

Before the speech Ruak signed a register, then amid applause by thousands of ordinary Timorese and guests that included Indonesian President Susilo Bambang Yudhoyono, he smiled and clasped his predecessor in his arms.

The half-island nation first declared independence on November 28, 1975, after Portugal ended four centuries of colonial rule but was immediately invaded by Indonesia.

The country was placed under a UN mandate in 1999, ending Indonesia's 24-year occupation that left up to 183,000 people dead from fighting, disease and starvation.

"Our history is a narrative of struggles and of hard work," said Ruak, who spent decades in the mountains fighting Indonesian forces.

"This tradition of hard work and dedication to our country ... has to be transposed to the present, to lift our people from their current predicament where the majority are poor to a stage in the future where the majority will be well off," he added.

Half of East Timor's 1.1 million population lives below the poverty line, and about 20 per cent is unemployed.

In a country with scant public transportation, many ordinary Timorese arrived on foot to watch the ceremony.

This is a crucial year for Asia's poorest nation, also known as Timor-Leste. It will choose a new prime minister and government in general elections on July 7, then at year's end will bid goodbye to UN forces stationed there since 1999.

Ruak won a run-off election last month that was widely lauded as peaceful and fair.

He takes over a country that is hobbled by extreme poverty, corruption and an over-reliance on energy revenues. More than 90 per cent of state spending now comes from oil and gas earnings.