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Telegraph
3 days ago
- Business
- Telegraph
The tiny Pacific nation evading China's grip
Avenida de Hudi-Laran is one of the busiest roads in Dili, the capital of East Timor. On any given day, motorbikes, cramped minibuses and yellow taxis speed past restaurants, spas and furniture supply stores. But instead of the usual Portuguese or Tetum – the country's two official languages – many of the establishments boast Chinese names. The expansion of Chinese-owned businesses has grown to such an extent that most people refer to Hudi-Laran, meaning 'banana complex', as 'China-Laran' now. It's a sign of Beijing's increasing investment in the small country, but its level of influence appears to have its limits. At a time when more and more Asian countries are falling into debilitating debt traps that grant China sweeping leverage, East Timor is resisting – for now. It is one of the world's youngest countries, having gained independence in 2002 after hundreds of years as a Portuguese colony and more than two decades under Indonesian occupation. The nation, located around 430 miles north-west of Australia, makes up the eastern half of the island of Timor, sharing the land with Indonesia. Its strategic position in the contested Indo-Pacific and nearby shipping lanes make the country ripe for Chinese influence. 'We do not view China as a threat, least of all as an enemy,' José Ramos-Horta, East Timor's president, told The Telegraph, insisting his country remains neutral in the battle for control of the Pacific. East Timor sits crucially near the Second Island Chain, a series of islands stretching from Japan through Guam – a US territory with a key military base – to Indonesia's eastern islands. Although further from China than the First Island Chain, which includes Taiwan and the Philippines, the second chain is widely viewed as an emerging battleground of influence. Pete Hegseth, the US defence secretary, said in April that the US would be boosting investment in the outlying chain of islands. East Timor is also situated near the Ombai-Wetar Strait, a deep-water passage that's critical for movement between the Indian and Pacific oceans. Given its placement, China has attempted to increase its military presence on the island, proposing the construction of a radar facility in 2007, which it claimed would only be used to detect illegal fishing. However, a leaked US diplomatic cable revealed that the site would've allowed China to collect intelligence on American and Taiwanese military activity in the South China Sea, where Beijing has expanded its presence in recent years. The government in Dili rejected the proposal. East Timor relies mostly on security agreements with its neighbours: Australia and Indonesia. While open to participating in joint military drills with China, Mr Ramos-Horta said there was only so much East Timor could offer a country such as China when it comes to defence. 'It's a bit like an elephant inviting a mosquito for joint military exercises. The Chinese will take cruise missiles, we will take slingshots,' he said. The bulk of East Timor's relationship with China is economic, but it has opted for a different route to many other countries. Chinese aid has funded East Timor's presidential palace, foreign ministry and military headquarters, and Chinese state-owned companies built and currently control the national power grid and its major port. The country upgraded its ties with China in 2023 to a comprehensive strategic partnership, which opened the door to 'unlimited' economic cooperation, one expert told The Telegraph. Despite Beijing's economic involvement in such infrastructure projects prompting concern, East Timor has avoided the 'debt trap' that has destabilised so many others. China has a history of lending billions to vulnerable governments that struggle to repay the loans and eventually fall under its thumb. Such has happened in Sri Lanka, which owed China nearly $25 billion (£19.5 billion) before it defaulted and fell into its worst financial crisis in decades. But while Chinese firms have built key infrastructure in East Timor, the projects have been through private tenders. The south-east Asian country has never taken a loan from China, meaning its influence there 'remains limited', according to Loro Horta, East Timor's ambassador to China. In 2012, it came close to accepting a $50 million loan from China to upgrade its drainage system, but Dili rejected the proposal because it gave Beijing disproportionate control over which company would carry out the project. Instead, East Timor took out grants from partners such as the Asian Development Bank and the World Bank, where there are fewer strings attached. The nation also follows a 'friends to all' policy, under which it receives foreign aid and investment from a wide range of partners – including Australia and the US – so it isn't entirely dependent on any one actor. China's grip looms Part of East Timor's ability to resist China's pull stems from its oil and gas revenue, but experts have said this could soon change. Despite being one of the poorest countries in the region by GDP per capita, it earns close to half a billion dollars in petroleum revenue annually, which funds nearly 90 per cent of its state budget. However, its main oil fields are predicted to be fully depleted within the next decade, meaning the country could be left bankrupt, according to Damien Kingsbury, a professor emeritus at Deakin University in Australia. The government is optimistic that more oil will be uncovered before it's too late, but others are worried that the impending economic crisis could push East Timor down the slippery slope towards greater dependency on China. 'Small countries such as East Timor risk having large investors and donors such as China swamp their local economy and thus lose a capacity to make independent economic decisions,' said Prof Kingsbury. 'China could end up having an outsized influence in policy making.' This has happened to countries in the Pacific before. The Solomon Islands, Kiribati and Nauru have all switched recognition from Taiwan to China in the past decade after developing closer ties with Beijing. The Solomon Islands, historically one of the poorest countries in the Pacific, signed a security agreement with China in 2022, opening the door for Beijing to establish a military base in the region. However, East Timor's 'friends to all' policy could help it to avoid falling into a similar entanglement. 'I have no particular grounds for concern. China has a positive relationship with East Timor – it's significant but not one of the top donors by any means,' said Michael Leach, a professor at Australia's Swinburne University of Technology. 'The Timorese leadership have always been careful to balance their relationships in sensitive ways,' he added. East Timor's bloody past The fact that East Timor has remained relatively unscathed when it comes to China is also a result of its recent bloody history. Indonesian forces occupied the country between 1975 and 1999, and killed around 200,000 people – of a population of only around 600,000. They tortured and slaughtered civilians and resistance forces, in what many scholars have labelled a genocide. 'Indonesia killed a lot of people, a lot of people suffered, and a lot of people sacrificed tremendously in order for it to be a sovereign nation and so they value that sovereignty,' said Charlie Scheiner, a long-time researcher at La'o Hamutuk, one of East Timor's oldest and largest human rights NGOs. No one understands this better than the president and prime minister, who both led the struggle. Mr Leach explained that Xanana Gusmão, the prime minister, spent years fighting and was later imprisoned 'in pursuit of the dream of self-determination and independence', which 'informs a lot of his outlook today on maintaining Timorese independence'. For Mr Ramos-Horta, who went on to win the Nobel Peace Prize for his efforts, his experience travelling the world and courting diplomatic support made him 'no stranger to the sort of traps that small countries can fall into with foreign policy if they're not careful', according to Mr Leach. Experts agree that East Timor's relationship with China is likely to expand – especially economically – but it will probably not reach a point where there would be a risk to its sovereignty or independence. 'Timor will always be a democracy. We can never be a dictatorship because we are so disorganised and undisciplined – it's impossible to have one country dominate Timor,' insisted Mr Loro. 'Many have tried. They usually fail,' he added jokingly.
The Diplomat
11-08-2025
- Business
- The Diplomat
Advancing Australia's Trilateral Partnership With Two ASEAN Neighbors
Fruitful relations between Australia, Indonesia, and Timor-Leste should be consolidated through the establishment of new trilateral mechanisms. In October, Timor-Leste is set to become the 11th member of the Association of Southeast Asian Nations (ASEAN), the most consequential regional grouping to Australia's north. For the first time ever, Canberra will have two ASEAN neighbors. Within the bloc, Indonesia has been the biggest supporter of Timor-Leste's application to join ASEAN. Australia too has been an important supporter of Dili's desire to join the grouping. Good relations with both Timor-Leste and Indonesia are both a strategic and diplomatic imperative for Australia. This is especially the case since regional cohesion falters under the weight of U.S.-China strategic competition and security challenges such as the Myanmar civil war and the Thailand-Cambodia border conflict. Closer communication, consultation and cooperation between Australia and its Southeast Asian neighbors is an investment in our shared future Timor-Leste's accession is an ideal moment for the Albanese government to build momentum for the elevation of the Australia-Indonesia-Timor-Leste trilateral partnership, from the foreign minister to the leadership level. As part of such an arrangement, annual trilateral leaders' and ministerial-level summits should be held, in line with the Indonesia-Australia Comprehensive Strategic Partnership (CSP), which aims to increase and strengthen trilateral meetings between Indonesia, Australia, and Timor-Leste. The trilateral meetings could focus on areas of shared interests and challenges like border security, defense infrastructure and maritime security. For instance, they could together increase their maritime security capabilities by running regular maritime patrols, holding annual joint military exercises, training, and naval port visits. Joint maritime training and patrols would be particularly beneficial for Timor-Leste's tiny navy, which continues to struggle combating illegal, unreported and unregulated fishing in its maritime waters. The country losses approximately $300 million per year due to illegal fishing in the Timor Sea. The 2022 Australia-Timor-Leste Reciprocal Defense Cooperation Agreement tries to address these security challenges, by increasing bilateral security cooperation, especially in the maritime domain. As part of the deal, Timorese defense personnel operating or training in Australia will receive the same protections, responsibilities, and privileges as Australian personnel will receive in Timor-Leste. In 2023, Australia committed to donating two Guardian-class patrol boats to Timor-Leste by 2024. Nonetheless, the Timor-Leste navy is yet to receive the vessels due to the inadequate condition of the Port Hera Naval base. Ironically, Timor-Leste was the central factor in the significant decline of Australia-Indonesia bilateral relations in the second half of the 1990s. The 1995 Australia-Indonesia security agreement was torn up by Indonesia in 1999 after the Australian-led multinational invention in East Timor, which had been an Indonesian province since its forcible incorporation in 1976. This marked an all-time low in the bilateral relationship, but in the years since it has been able to recover from this setback and has matured over time. In the 2006 Lombok treaty, Jakarta and Canberra recognized each other's territorial integrity, and they upgraded their strategic ties to a CSP in 2018. Under the new Australia-Indonesia Defense Cooperation Agreement, the two neighbors have pledged to ramp up joint military exercises and training to unprecedented levels and allow both nations to operate from each other's countries for mutually determined cooperative activities. Since its independence in 2002, Timor-Leste has taken a realist foreign policy approach. The key priorities of Timorese foreign policy have included campaigning for full ASEAN membership and ensuring strong ties with its two large neighbors, Australia and Indonesia. Today, Timor-Leste enjoys cordial relations with Indonesia, its largest trading partner. Citizens of Timor-Leste also have visa-free access in Indonesia. No doubt, without the crucial support of Indonesia, Dili's aspiration of becoming an ASEAN member would have been virtually impossible. The Indonesian National Armed Forces also provide military education and training to personnel from the Timor-Leste Defense Force. The neighbors maintain a joint border security task force, which often conducts joint border patrols along the Indonesia-Timor-Leste border. They've also resolved and determined most of their land boundaries. While the region of Naktuka remains a disputed border area, Timor-Leste's Prime Minister Xanana Gusmao recently stated that the two nations are 'working together to resolve the dispute in accordance with international law.' Subsequently, the deepening of bilateral ties between the three neighbors sets solid foundations for a high-level trilateral. It would also realize the full potential in existing trilateral ties. The trilateral partnership should also reaffirm ASEAN's 'centrality 'in the Indo-Pacific. Australian foreign policy sees ASEAN at the center of a peaceful, stable and prosperous region, where sovereignty is respected, and all countries benefit from strategic balance. In 1974, Australia became the grouping's first dialogue partner. Since its humble beginnings over 50 years ago, the ASEAN-Australia partnership has gained in strength. In 2010, the ASEAN-Australia-New Zealand Free Trade Agreement came into effect. And, in 2021, the ASEAN-Australia relationship was elevated to a Strategic Comprehensive Partnership. Overall, Australia prioritizes a strong relationship with Southeast Asia and its northern neighbors. In Indonesia and Timor-Leste, Australia will very soon have two ASEAN countries right on its doorstep. Amid growing unpredictability in the region, now is the time for Australia to seek a high-level trilateral with its two important neighbors.
ABC News
06-08-2025
- Politics
- ABC News
Location plans for new Timor-Leste stadium sparks environmental concerns
Debate is raging in Timor-Leste over a controversial plan to build a multi-million dollar soccer stadium in the capital, Dili Construction for the 15,000-capacity outdoor stadium and indoor futsal court, which will be part funded by FIFA, is due to begin later this year at an estimated cost of $30 million-dollars. The site chosen for the new development is at the centre of concern, because not only is it a protected environmental zone, but it's also a sacred religious area. "We're grateful for this beautiful stadium but … the government needs to look elsewhere for the location," said Tasi Tolu resident, Fernando Vicente de Jesus. "During the northern winter up to an estimated nine million migratory shorebirds fly between these Palearctic breeding grounds and winter mostly in Indonesia, Australia and New Zealand. Most birds fly over Timor-Leste, but for some of these migratory shorebirds Timor-Leste - and Lake Tasi Tolu – provides vital feeding and roosting habitat," said Potenzo Lopes, a Naturalist and Wildlife Conservationist. Fernando Batista Xavier, the Deputy of General Secretary of Timor-Leste Football Federation says the Football Federation is still waiting for the land allocation from the Ministry of Justice before the build commences. ""Since we gained independence, we have not had a stadium to international standards," said Mr Xavier. "The stadium there will not destroy important values that already exist. FFTL is ready to sit together listen to the ideas, to make this place more beautiful, to respect the image and dignity of the site," he added.
South China Morning Post
08-07-2025
- Politics
- South China Morning Post
Will Myanmar block East Timor's Asean entry? Junta's NUG warning shot tests bloc's unity
As East Timor edges closer to joining Asean , Myanmar's military rulers are seeking to block its entry, in a warning to it – and governments everywhere – against engaging with the war-torn country's opposition forces. Last week, sources cited by public broadcaster Thai PBS revealed that Myanmar 's military regime had formally notified Malaysia , the current chair of the Association of Southeast Asian Nations, of its intent to withhold support for East Timor's membership when the bloc convenes in October. Naypyidaw's objection centres on accusations that East Timor has breached Asean's foundational principle of non-interference in the internal affairs of member states, as enshrined in the bloc's charter. The junta has called on East Timor's government in Dili to 'refrain' from any dealings with the National Unity Government (NUG) – a group of elected lawmakers ousted by the 2021 coup – and other resistance groups fighting military rule in Myanmar. A soldier from the Kachin Independence Army, an ethnic armed group in Myanmar, puts on his shoes as he and his comrade cross a stream. Photo: Reuters In a letter, the junta warned that if Dili continued to openly violate the non-interference principle when it came to Myanmar's internal affairs, then 'we must firmly reject any consideration of granting Asean membership' to East Timor. It was reportedly signed by Myanmar official Han Win Aung, the bloc's director general for Asean-Myanmar affairs and an alternate leader of its Senior Officials' Meeting.
ABC News
06-07-2025
- Politics
- ABC News
Deep sea mining regulations on the agenda as International Seabed Authority Assembly kicks off
On the program today Delegates from around the world arrive in Jamaica for the International Seabed Authority Assembly, where regulations for deep sea mining may be finalised. Hopes of Bougainville independence grows after leaders sign the Melanesian Agreement. US aid cuts threaten a massive infrastructure project designed to provide clean water for the population of Timor-Leste's capital city Dili. Solomon Islands celebrates 47 years since becoming independent from British rule. The sprint king and queens of the Pacific Mini Games are crowned in Palau. And statistics reveal a sharp decline in marriges in Fiji.
