The BGA Timor-Leste team, led by Senior Adviser Amb. Ian Kemish, wrote an update to clients on relations between Timor-Leste and China.

Context

  • , causing concern among Western partners.
  • Timor-Leste clearly hopes that increased cooperation with and assistance from China will give the young island country an important development boost at a crucial time. The island’s economic future depends on the establishment of a new gas project and urgently diversifying from its dwindling natural resources.

Significance

  • For China, an upgraded partnership with Timor-Leste is highly strategic. The country’s geographic and cultural placement at the intersection of Southeast Asia and the Pacific Islands makes it an ideal vantage point from which to project influence.
  • The new partnership will not sit well with Western partners, for whom an increasingly powerful China presents a threat to regional security. The announcement is worrying for Australia and the United States, particularly if the partnership leads to an increased Chinese military presence and more infrastructure projects at Australia’s doorstep.

Implications

  • Businesses should note increased Chinese involvement in Timor-Leste’s economy,including in communications and transport infrastructure and the oil and gas industry under the comprehensive strategic partnership, which is a blow to Australia’s security calculations.
  • Expanding bilateral trade and investment is a central focus of the new partnership, which will be enhanced in four key areas: industry revitalization, infrastructure development, food self-sufficiency and livelihood improvement.

We will continue to keep you updated on developments in Timor-Leste as they occur. If you have any comments or questions, please contact BGA Senior Adviser Amb. Ian Kemish at ikemish@bowergroupasia.com.

Best regards,

BGA Timor-Leste Team

A small ginko leaf