The highlight in ASEAN news for the past few weeks, Indonesia has agreed that East-Timor will be included in the ASEAN agenda for 2023, which Indonesia will be the Chairmanship for this year. However, there are still some polemics among ASEAN countries in terms of their subjective assessment of East-Timor capacity to enter ASEAN – based on its reputation on the global stage. A discussion among academicians previously said that since Indonesia declared its independence, Indonesia still has unstable relations with East-Timor governments, especially about human rights issues. Both of the countries still have the same stigma and tension, moreover escalated by the trauma in 1999 when East-Timor decided to break away from Indonesia.

In geographical location, East-Timor is located in the South East-Asia region which means it has the opportunity to be a member in ASEAN regional organization. However, since 2011, East-Timor still has not achieved its status as a member of ASEAN. There were still pros and cons among ASEAN members regarding East-Timor’s membership. Indonesia and Malaysia are the two main countries that most support East-Timor’s membership of ASEAN. On the other hand, Singapore and Laos still do not agree if East-Timor becomes part of ASEAN. The two countries that disagreed argued that East-Timor was not yet ready economically and politically, so it was not yet the time to join, moreover involving in the next level of economic movement in ASEAN.

However, this has proven otherwise with changes in the dynamics and geopolitical constellation in ASEAN per se.  On February 11, 2022, East-Timor became a member of ASEAN. Then, in February 2023, East-Timor legally became a member of ASEAN. Simultaneously, this year will be the right time for Indonesia as it becomes the chairman of the ASEAN Chairmanship 2023. Thus, Indonesia officially established more serious economic relations with East-Timor, marked by an agreement between Joko Widodo as President of the Republic of Indonesia and Taur Matan Ruak as Prime Minister of East-Timor  to establish a bilateral investment treaty. Thus, what are the factors that cause Indonesia as chairman of ASEAN 2023 to want to establish this economic relationship? What dilemmas will arise in the future?

The Factors Behind the Cooperation

As chairman of ASEAN 2023, Indonesia has certainly taken seriousness in this cooperation in taking economic steps that can affect the dynamics of the international world. Joko Widodo’s decision to strengthen economic cooperation with East Timor is pragmatically seen as a strategic step for Indonesia to gain the side of populism in the eyes of the world community. One of the strategies adopted by Indonesia is to improve connectivity by establishing a bus route connecting Kupang in East Nusa Tenggara province and Dili, the capital city of Timor-Leste.

It is possible that Indonesia’s economic strategy as chairman of ASEAN 2023 definitely wants to bring the interest of convenience in the transportation and distribution of goods and services. Therefore, Jokowi built infrastructure on the border of NTT Province and Oecusse Municipality so that the two countries could have good economic relations through the land border. Apart from that, Indonesia also wants East-Timor to not only be under the control of Australia which Australia continues to take advantage of in various sectors. 

Other than that, from Indonesia’s perspective, Indonesia still needs to enhance in several areas, such as education and industrial sectors with the ASEAN members. This will lead to the willingness of Indonesia to strengthen those sectors by establishing this bilateral treaty, one of them is with East-Timor. Retno Marsudi, Indonesian Foreign Affairs Minister, believed that this cooperation will enable the two countries to enhance stability and mutual prosperity.

The Potential Dilemmas Will Arise

However, Indonesia’s strategic efforts to establish an economy with East-Timor  have its own challenges and dilemmas. One of them is Timor-Leste’s economic growth which is considered very much dependent on oil business revenues through the Petroleum Fund. This can affect the flow of oil reserves and prices both in Indonesia and in ASEAN itself. These funds can slowly run out and lead to a decline in public finances, pose a risk of economic instability, and finally reduce the ability of countries to meet the other needs of ASEAN members.

In addition, the validation and credibility of East-Timor as a developing country has not been guaranteed economic and political stability. This seems to raise the assumption that what Indonesia is doing is only a moral obligation as a fellow member of ASEAN which can be said that Indonesia strategy is not based on a strong reason. Indonesia’s decision to establish economic cooperation with East-Timor will indirectly bring inevitable consequences in the future.

The consequences that can occur include that Indonesia must have better and more stable economic and political conditions. The gap between Indonesia and East-Timor is quite significant so that it cannot be blamed if in reality Indonesia contributes more to help build and boost the economy of East-Timor later. Apart from that, the reputation of Timor-Leste which is not yet as strong as other ASEAN countries economically and politically is also a separate dilemma for Indonesia as chairman of the chairmanship in terms of making East-Timor equal to other ASEAN countries so as not to widen the gaps that exist between ASEAN countries.

Bilateral economic cooperation between Indonesia and East-Timor does provide a glimmer of idealism for Indonesia’s economic strategy in the midst of its role as chairman of the ASEAN Chairmanship 2023. However, it needs to be emphasized that Indonesia’s strategy cannot be considered ideal overall in this regard. Opening up the seriousness of bilateral economic cooperation is a big step that needs to be considered, especially for the consequences and dilemmas of the challenges that will occur. Indonesia needs to be prepared economically and politically to face other possibilities that arise as new problems amid its position as chairman of ASEAN 2023.