Gusmao quits presidential race

Gusmao has unrivalled public support

East Timor's independence leader Jose "Xanana" Gusmao has said he will not stand for president in the upcoming election.

I will not run for president

Xanana Gusmao

He said he was stepping down because political squabbling was hampering the territory's progress towards independence.

"I believe that I could do something for this country and these people, if it was in a different stage of the process, the liberation struggle," said Mr Gusmao, who on Wednesday quit as head of the interim parliament.

Mr Gusmao, 54, led a guerrilla war for many years against Indonesia, which invaded Indonesia in 1975, before his capture in 1992 and imprisonment for seven years.

Credible leader

After the East Timorese voted to sever ties with Indonesia in 1999, a campaign of killings and destruction by pro-Jakarta militias gripped the territory until an Australian-led international peacekeeping force arrived in September 1999.

The territory is now being administered by the United Nations.

I am still completely hopeful he will in the end... [stand as president]... He cannot just walk away

Jose Ramos Horta

Seen as the most popular and credible leader, Mr Gusmao was widely expected to become the first president when East Timor becomes fully independent later this year.

Sergio Vieira de Mello, head of the UN administration, said he was upset by the development, describing Mr Gusmao as key to stability.

But he told the BBC that he understood Mr Gusmao's reasons.

Tortuous process

Gusmao has resigned before

Mr Vieira de Mello agreed with Mr Gusmao's criticism of parliament, for failing to consult the people on the country's new constitution.

But he said the row was just one episode in a long and tortuous process.

Mr Gusmao quit after a bitter debate about the new constitution.

He said he was angry by the refusal of his own party, Fretelin, to canvass the views of East Timor's people about their future constitution.

He also said the UN-appointed National Council no longer reflected the views of East Timorese people.

And he complained that his attempts to break the deadlock were futile because of the "unwillingness" of council members to advance the political process.

Reversal of decision

Indonesia militia killed many during the independence vote

Elections for the new parliament are scheduled for August, after which a new constitution will be drawn up.

Correspondents say Mr Gusmao's resignation from his position as head of the interim parliament raises questions about the territory's future.

However, there is still hope that he may reverse his decision - as he did when he resigned last August.

"I am still completely hopeful he will in the end accept [to stand as president]," Nobel laureate Jose Ramos Horta, also a council member, said. "He cannot just walk away."