East Timor’s President Jose Ramos-Horta said the country has not engaged in discussions regarding military cooperation with China as part of its efforts to enhance diplomatic relations.
In a media statement on Sept. 29, he emphasised that Australia and Indonesia need not worry, as East Timor (also known as Timor Leste) does not pose a security threat to its neighbouring countries.
He added: “Indonesia and Australia, we can include Singapore and Malaysia—they are the countries that are closest to us—can always sleep at peace. Timor Leste is not going to be a nuisance, a concern in terms of security.”
President Ramos-Horta’s statement comes after Chinese state media disclosed that Beijing’s agreement with East Timor also encompassed military exchanges.
China and East Timor Strengthen Economic Ties
China and East Timor announced on Sept. 23 that they had upgraded their bilateral ties to a comprehensive strategic partnership, a move they said would strengthen energy policy exchange while satisfying the East Timor’s desire for stronger links to major economies.The agreement to enhance relations came after Chinese leader Xi Jinping met East Timor’s Prime Minister Xanana Gusmao in the eastern Chinese city of Hangzhou before the opening ceremony of the Asian Games.
This move potentially gives Beijing more influence in the region and on the island nation, which is less that 700 kilometres (434 miles) from Darwin.
Part of the partnership involves allowing China and East Timor to study joint oil and gas exploration.
China’s Expanding Influence in the Pacific Region
Expanding its reach beyond Southeast Asia, the Chinese Communist Party (CCP) has established relationships with smaller Pacific nations in recent years, raising alarm among the United States, as well as its allies Australia and New Zealand, which have traditionally regarded the region as their sphere of influence.The CCP entered into a security agreement with the Solomon Islands last year, a nation located 2,000 kilometres to the northeast of Australia.
This development increased Canberra’s concerns regarding Beijing’s maritime ambitions, and there are concerns that the CCP will establish its presence in other nations in the Pacific region.
The Petroleum Fund That Keeps East Timor Running
East Timor is currently surviving on a $26 billion sovereign wealth fund that keeps the government running called the Petroleum Fund.It was established in 2005 to manage the country’s oil and gas revenues, and it has become the main source of government revenue.
The Petroleum Fund has been a boon for East Timor, but it is also a finite resource and if the government does not find new sources of revenue, and the Petroleum Fund could be depleted within the next decade.
The Australian government is concerned that once the Petroleum Fund runs out, East Timor could become bankrupt.
It has been working with the Timorese government to develop a more sustainable economic model with one of the key priorities to develop the Greater Sunrise gas field located in the Timor Sea.
The Greater Sunrise project could generate billions of dollars in revenue for East Timor over the next several decades.
East Timor’s president is advocating that a vital gas pipeline that is part of the Greater Sunrise project link the Timor Sea reserves directly to his nation, rather than routing it through Darwin.
He has cautioned that if Australia and Woodside Energy do not endorse this proposal, East Timor will explore the possibility of seeking CCP support for the project hence playing off China against Australia in what has been dubbed “The China Card.”
