Towards an Integrated Southeast Asia: Timor-Leste’s Challenges and Opportunities in Joining ASEAN

Authors: Jalaluddin Rizqi Mulia and Silvia Jultikasari Febrian*

Association of Southeast Asian Nations, or ASEAN for short, is an organization originally formed to respond to the Cold War in the region by five founding member states: Indonesia, Malaysia, Singapore, Philippines, and Thailand. Timor-Leste itself had been attempting to join ASEAN since 2011, considering that Timor-Leste is geographically and culturally a country in Southeast Asia. Despite this condition, the country experienced difficulties in its efforts. These happened due to the unstable situation of the country, particularly in terms of political, economic, and security.

As a regional institution, ASEAN’s role is increasingly developing into a multidimensional organization. In order to strengthen its integration efforts, the ASEAN Community was formed to reinforce the centrality and role of ASEAN as a regional power which plays a major part in designing the territorial framework, accompanied by the signing of ASEAN Charter–marking the commitment of its member states in building the community through cooperation expansion and regional integration. The ASEAN Community itself consists of three main pillars: ASEAN Political-Security Community (APSC), ASEAN Economic Community (AEC), and ASEAN Socio-Cultural Community (ASCC).

Why did Timor-Leste join the regional organization?

Indonesia has been one of the parties which pushed the acceptance of Timor-Leste as a member state since long ago. Nevertheless, it should be noted that every policy issued by ASEAN requires unanimous votes from all member states. The new membership intention itself faced a number of challenges, such as Singapore’s refusal and questioning Timor-Leste’s steadiness and ability. Such a view is based on an assessment on Timor-Leste that it will only be a burden for ASEAN, which is currently on the way for economic integration.

The rationale underlying the appliance refusal is Timor-Leste’s condition to meet the eligibility prerequisites for membership. Timor-Leste itself is a small country with social conditions living in high poverty ($1.90/day in 2022); it is feared that it will only creating hardships on other member states as they are–ethically speaking, obliged to help, bearing in mind that full membership demand payment for around US$2.5 million per year. In fact, locally, President Ramos-Horta faced hesitation due to a lack of human and economic resources in light of ASEAN which conducts hundreds of various-level meetings each year. Other than that, the country’s reluctance to address the opposing stance towards Myanmar junta in the United Nations also caused delay in the joining process.

Even though historically, ASEAN has always welcomed new members regardless of rich-and-poor considerations on countries capabilities or resources. This is what made Laos and Myanmar join in 1997 and Cambodia in 1999. In short, as long as the precondition of geographic location is met, any country is eligible to apply, which is also stated in the ASEAN Charter. Other than that, the candidate must be recognized by all member states, abide the charter, and have the willingness and ability to carry out the membership obligations. Nonetheless, it should be noted that the current ASEAN system can not be completely generalized to that of the 1990s.

In the meantime, ASEAN agreed in principle to acknowledge Timor-Leste. Along with being sent a fact-finding mission from the three ASEAN communities, Timor-Leste was given the status of observer state which allows itself to participate in numerous ASEAN meetings, though could not contribute directly to the process of conveying views to making decisions. Hopefully in the near future, the mission will release a report outlining a roadmap for Timor-Leste’s full membership in ASEAN.

As it holds the ASEAN stewardship in 2023, Indonesia–a country that has been the traditional first visit for new leaders of Timor-Leste, is expected to accelerate the new member acceptance process. The outlook is that Timor-Leste can obtain full membership when Indonesia, as the chairman, hosts the ASEAN Summit in 2023.

The presence of new challenges

Economically-speaking, Timor-Leste’s economic growth is highly dependent on income from the oil business through the Petroleum Fund. Sooner or later, these funds will slowly run out and will only bring downturn effects on public finances, putting risk of economic instability, and eventually reduce the country’s capacity to fulfill the ASEAN membership necessity. At the moment, Timor-Leste is setting out to manipulate its overdependence on oil by shifting on other alternatives, such as industry of tourism and manufacturing. Another potential step is to galvanize the private sector which can attract foreign investments. Institutions, meaning government, become the initial determinant of effective and efficient development achievements. One which needs to be considered is that development mostly requires process to create better life for the society, including in Timor-Leste.

In the context of administrative aspects, Timor-Leste can adjust local policies–as alterable as possible–in line with ASEAN regulations, bearing in mind the characteristic of ASEAN treaties and conventions are legally-binding. These efforts must be directed towards the future of an independent Timor-Leste, as overdependence to foreign parties will only affect the decision-making process. Meanwhile, there are many sources of foreign aid to Timor-Leste, primarily from Australia, Japan, Portugal, European Union, United States (US), and China.

Aside from that, in a social-community context, the condition of Timor-Leste’s human resources is also a notable concern. In 2020-2021, the unemployment rate of citizens aged 25-31 is 43.3%. This situation can actually be minimized by encouraging community capacity education and training, which confidently will boost labor productivity. Given Timor-Leste’s target to avoid dependence on oil commodities, investment in human resources is a noteworthy matter to be acknowledged.

Timor-Leste’s reputation as a developing country experiencing instability, both politically and economically, makes other ASEAN member states in having moral obligations to assist the former. Pursuing economic targets unquestionably demands extra energy for Timor-Leste. Should the issue not be immediately corrected and changes are made, it will assuredly create a steep road when becoming a member of ASEAN later as it takes more time to reach other ASEAN member states’ economic abilities. Without question, this is a big stumbling block for Timor-Leste–the good intentions to admit it as a member might turn into problematic conditions for ASEAN in the future.

On one hand, all challenges have made several parties, particularly Singapore, hesitate to agree on Timor-Leste registration prior to its ratification as an official member. While on the other hand, Timor-Leste’s position in trading activity (exports-imports) is significant in the region, hence potentially becoming an important partner for Southeast Asia countries.

Emergence of potential opportunities

Presumably for the East Timorese, joining ASEAN means an open access for local residents, especially in the field of tourism and manufacturing, which is beneficial in expanding economic capacity. This includes the cross-border employment opportunities, particularly the ASEAN Economic Community which covers eight major industries for an ASEAN market of 683 million people. These opportunities will encourage the diversification of state revenues from oil and gas to other potential sectors, such as agriculture and tourism.

Furthermore in the economic sector, Timor-Leste will gain closer relations with neighboring ASEAN countries. Between 2016 and 2019, more than half of Timor-Leste’s imports originate from five ASEAN member states, amounting to US$2.05 trillion, whereas the figure for exports of goods and services was only US$95 million. Timor-Leste admittance to ASEAN can reduce this level of trade activity gap.

In a geopolitical context, Timor-Leste–as a part of ASEAN–can avoid the possibility of being exploited for the benefit of foreign influences. Timor-Leste’s government even confessed on a likelihood to totally ally with the US or China should ASEAN not agree to the membership application. Nevertheless, it should be noted that China’s role can not be underestimated given that the country has aid to fill Timor-Leste’s infrastructure gap. Its involvement in ASEAN, at least, offers a safety net that the Portuguese-speaking country will adjust its policies to the interests of ASEAN. Perceiving the regional dynamics, political and security reasonings must be made priorities instead of merely economic considerations.

The entrance of Timor-Leste is touted to be a model of democracy. Compared to many other states in ASEAN, including Myanmar and Thailand, which–at some point–are still authoritarian and supported by the military; let alone Laos, Vietnam and Cambodia which are communist countries, the presence of Timor-Leste might help the process of democratization in the region. Certainly, this will be challenging for a small democratic country which is presently struggling.

Moreover, in an institutional aspect, the recognition of Timor-Leste can make the organizational regulations gradually adapt to issues of contemporary dynamics. Moreover, the ASEAN Secretariat might be given authority to have a greater role in active and constructive use to ensure ASEAN’s long-term projects. This notion is not only to accommodate new members, but to model ASEAN as a more adaptive organization which is steady in facing future challenges.

Eventually, Timor-Leste’s membership in ASEAN hopefully can become a new opportunity for well-integrated cooperation. Opportunities for cooperation and markets of Timor-Leste will be wide open and beneficials for ASEAN member states and also its dialogue partners. The reciprocal relationship between the two parties is expected to go hand-in-hand. Thus, ASEAN member states must provide support through the provision of capacity related to building assistance and other forms of assistance relevant with Timor-Leste’s needs. Simultaneously, Timor-Leste is also supposed to exhibit contributions for the development and progress of ASEAN. This will be advantageous in the form of a more active and effective cooperative relation in the future of ASEAN.

*This article is co-authored with Silvia Jultikasari Febrian, an undergraduate student of International Relations, Universitas Islam Indonesia.

Jalaluddin Rizqi Mulia
Jalaluddin Rizqi Mulia
Undergraduate Student at Department of International Relations, Universitas Islam Indonesia