As geopolitical competition intensifies across Southeast Asia, the Association of Southeast Asian Nations (ASEAN) is on the cusp of welcoming its eleventh member, Timor-Leste.

With Cambodia, Indonesia, Malaysia, and other regional powers backing its accession, the bloc’s expansion appears inevitable. But behind the diplomatic choreography lies a harder truth: Timor-Leste may win the seat, but is it institutionally ready to rise to the moment?

Timor-Leste's journey toward ASEAN membership has been a long and determined one. The nation has a strong possibility of becoming the eleventh member of ASEAN in 2025, coinciding with Malaysia's chairmanship of the regional body. A final decision regarding full membership is anticipated in May, signaling a potentially pivotal moment in Timor-Leste's foreign policy trajectory.

And Timor-Leste’s leaders are leaving little to chance. President José Ramos-Horta and Prime Minister Xanana Gusmão—two of the country’s most prominent independence-era figures—have become its chief advocates on the global stage.

Ramos-Horta, a Nobel Peace Prize laureate, has actively positioned ASEAN membership as a strategic necessity for the nation’s economic diversification and regional security. Gusmão, whose return to power in 2023 reaffirmed his political dominance, has resumed a key diplomatic role, lobbying Southeast Asian leaders and stressing Dili’s commitment to ASEAN principles. Their efforts reflect not just diplomacy, but a deep conviction that ASEAN offers a path to long-term national stability and prosperity.

Cambodia has emerged as one of Timor-Leste’s strongest champions in the region. During its ASEAN chairmanship in 2022, Cambodia led the charge for Dili’s inclusion, culminating in ASEAN’s “in-principle” agreement to admit Timor-Leste as the bloc’s eleventh member. Former Prime Minister Hun Sen’s pledge to share Cambodia’s experience and accession roadmap was more than a diplomatic gesture—it was a moral pivot. On April 4, Timor-Leste Foreign Minister Bendito dos Santos Freitas met Prime Minister Hun Manet and thanked Cambodia for supporting his country’s membership in ASEAN.

For decades, ASEAN’s policy of non-interference enabled silence during Indonesia’s occupation of East Timor. The 1991 Santa Cruz massacre in Dili, where Indonesian troops killed over 250 peaceful demonstrators, symbolized ASEAN’s complicity. That legacy, chronicled in my book ‘East Timor: Blood and Tears in ASEAN’, remains a stain on the bloc’s history.

Today, ASEAN is trying to make amends—not only politically, but economically. Integration through the ASEAN Economic Community (AEC), launched in 2015, has become one of the most ambitious regional efforts to create a single market and production base. The AEC seeks to facilitate the free flow of goods, services, skilled labor, and capital across member states. But to participate meaningfully, each member must align with core agreements, adopt enabling legislation, and harmonize standards—tasks that remain daunting for Timor-Leste.

Challenges on the Horizon

Dili’s economy, heavily reliant on oil revenues from the Timor Sea, remains underdeveloped and poorly diversified. The Petroleum Fund, established as a sovereign wealth mechanism, provides financial cushioning but cannot substitute for sustainable growth. Agriculture employs nearly 60 percent of the population yet contributes only about 17 percent of GDP. Manufacturing is minimal, and exports are limited largely to coffee and a handful of niche products. Timor-Leste ranks 181 out of 190 countries in the World Bank’s Doing Business index, reflecting bureaucratic delays, legal ambiguities, and weak contract enforcement.

Crucially, the country lacks foundational commercial laws. Investor protection frameworks remain fragmented or absent. A coherent land tenure system is still under development, complicating infrastructure planning and private sector engagement. There is no independent arbitration body to resolve commercial disputes efficiently. These legal and regulatory voids create uncertainty—discouraging both domestic entrepreneurship and foreign direct investment (FDI).

This is a critical gap, given that ASEAN integration is increasingly driven by investment and supply chain connectivity. ASEAN is the world’s fifth-largest economy, with intra-ASEAN trade accounting for around 22 percent of the bloc’s total trade. The Regional Comprehensive Economic Partnership (RCEP), to which nine ASEAN members are parties, further enhances regional economic alignment, lowering tariffs and standardizing customs procedures. For Timor-Leste to plug into these frameworks, it must first streamline trade procedures, digitize customs, and adopt rules-based systems that match ASEAN’s common market aspirations.

Timor-Leste’s geographical position should offer strategic advantages. Nestled between Indonesia and Australia, and facing growing maritime routes in the Timor Sea, it has the potential to serve as a logistics and connectivity hub. There are long-term proposals for a deep-sea port in Tibar Bay and air connectivity initiatives aimed at linking Dili more directly to regional hubs like Jakarta and Singapore. But these projects require not only capital but investor confidence—confidence that stems from legal predictability, institutional efficiency, and political stability.

To date, these ingredients remain uneven. Governance is often marred by rivalry between major parties—particularly FRETILIN and CNRT—with coalition breakdowns regularly derailing national priorities. Public sector reform has been slow, with overlapping mandates and limited capacity hampering implementation. Corruption, though not rampant, remains a persistent concern, as oversight institutions lack full independence or enforcement power.

ASEAN's Calculus: Weighing Unity and Capacity

That said, Dili has not stood still. Since 2022, it has undertaken multiple assessments in collaboration with ASEAN to identify readiness gaps. The ASEAN Secretariat, with support from partners like Australia and the EU, has assisted Timor-Leste in preparing sectoral integration plans. There have been pilot reforms in customs processing, training for civil servants on trade facilitation, and drafting of investment-friendly legislation. But much remains aspirational. Without sustained political will and a cross-partisan commitment to reform, progress could stall after membership is secured.

The burden of readiness lies not just with ministries and lawmakers—it must also be carried by civil society and the private sector. Economic integration will require small and medium-sized enterprises (SMEs) to become more competitive, digitally literate, and regionally connected. Education reform and vocational training must align with ASEAN’s labor mobility initiatives. The Timorese workforce, youthful and ambitious, needs more than rhetoric—it needs pathways to skills, jobs, and entrepreneurship.

The symbolism of ASEAN membership is powerful. For a country that was once violently excluded from the regional order, full participation signals hard-won legitimacy. It affirms that democracy, though fragile, can survive and mature in Southeast Asia. But symbolism alone cannot unlock markets, create jobs, or deliver prosperity. Only robust institutions—backed by law, transparency, and reform—can do that.

Cambodia’s support, ASEAN’s goodwill, and the tireless diplomacy of Ramos-Horta and Gusmão have brought Timor-Leste to the doorstep of regional integration. Walking through that door will require a transformation that goes deeper than policy—it must reshape governance itself. The success of this integration will ultimately hinge on Timor-Leste's ability to address its fundamental weaknesses and on the continued commitment of ASEAN member states to provide the necessary support and guidance.

The headlines surrounding Timor-Leste's ASEAN membership should therefore capture this inherent tension: celebrating the political victory while acknowledging the substantial work that lies ahead to ensure meaningful and mutually beneficial integration. The promise of ASEAN is not just to belong, but to build. If Timor-Leste meets that challenge, it will not only secure its place at the table—it may inspire the region anew.