Timor-Leste Joins ASEAN

The Diplomat

21 hours ago

In October 2025, Timor-Leste will be officially admitted to ASEAN as its 11th member state. This will mark the realization of the long-standing aspiration for regional integration the young country has had since it won independence in 2002. For ASEAN, it represents not only an ideological achievement, but will also serve as a starting point for significant changes to the bloc's systems and frameworks.
First, Timor-Leste's admission represents an important ideological milestone for ASEAN. As a regional community that champions 'inclusivity,' the international community will likely welcome the fact that ASEAN is not excluding the poorest countries in the region, but is instead working together through support and institutional alignment. Since Timor-Leste's application in 2011, ASEAN has provided phased support and conducted assessments, requiring the country to sign and ratify 84 ASEAN-related agreements. This includes not only the ASEAN Charter but also the ASEAN Comprehensive Investment Agreement (ACIA), the ASEAN Free Trade Area (AFTA), and the ASEAN Mutual Recognition Arrangements (MRAs).
However, there is a fear that admitting Timo-Leste will expose institutional weaknesses within ASEAN. The most significant issue is the rigidity of the bloc's consensus-building process. ASEAN continues to adhere to the principle of consensus, and with Timor-Leste joining despite its underdeveloped administrative systems and diplomatic capacity, there are concerns that discussions could be stalled and decisions delayed. As seen in ASEAN's response to the Myanmar issue and the South China Sea issue, differences in position among member states can make it difficult even to adopt joint statements. As the diversity of member states increases, ASEAN will inevitably have to consider greater flexibility in its decision-making process, including gradual governance reforms that allow for majority voting, in order to enhance its international visibility and influence as a regional cooperative organization.
There are also concerns about the widening economic disparity within the bloc. With a per capita GDP of around 1,000 USD, Timor-Leste ranks alongside Myanmar as the poorest in the region. However, with an economy that is just one-thirtieth the size of Myanmar's, it is difficult for the country to independently develop systems and infrastructure. As a result, the burden of support is expected to fall on higher-income member states and external partners such as Japan, Australia, and the European Union. This 'uneven distribution of aid' could eventually undermine cohesion within ASEAN.
Moreover, a history of infrastructure development with Chinese support in Timor-Leste could lead to political friction among member states over relations with China, something that was previously seen with Cambodia. For example, while there are already differing views within the bloc on the territorial disputes in the South China Sea, if Timor-Leste adopts an increasingly pro-China stance, the 'ASEAN voice' could become even more fragmented. This also raises concerns about undermining ASEAN's cohesion in the ASEAN Outlook on the Indo-Pacific (AOIP).
In this complex environment, the greatest challenge will be bolstering Timor-Leste's institutional adaptability while achieving inclusive development without slowing the pace of ASEAN's overall integration. This will require three measures: a reevaluation of the principle of consensus, an expansion of 'differential integration' and the 'ASEAN-X Formula,' which allow for flexible institutional arrangements among member states and participation at later stages, and strengthening of the functions of the ASEAN Secretariat and restructuring its funding mechanisms.
In addition to adhering to the internal rules of the ASEAN Economic Community (AEC), Timor-Leste will need to develop institutional frameworks to align with and participate in the Regional Comprehensive Economic Partnership (RCEP) and the ASEAN+1 Free Trade Agreements (FTA). This will involve developing systems for tariff classification, certification of origin, and implementing investment protection provisions. The FTA implementation arrangements, certification of origin, and tariff operations newly required by ASEAN membership will place a significant burden on Timor-Leste's fiscal structure and human resources. As noted in the IMF's June 2025 country report, structural reforms to public expenditures and the clarification of fiscal priorities will be essential over the next decade
The IMF noted that 'substantial savings from past oil production can help build a thriving economy for future generations—if spent 'better and more slowly.'' In this context, increased expenditures related to RCEP/ACIA compliance and the development of trade systems will be unavoidable with ASEAN membership. It will therefore be necessary for partners both within and outside the region to work together to support the country's institutional development and growth strategy.
Despite the requirement for institutional compliance with customs and e-commerce frameworks under ASEAN FTAs and RCEP, Timor-Leste appears to be lagging significantly behind in developing its land and accounting systems. As noted by the IMF, institutional reforms to promote private investment are an urgent priority, and technical cooperation from ASEAN+3 should be utilized.
Ultimately, Timor-Leste's admittance into ASEAN will serve as a litmus test of the bloc's ability to balance opposing forces: ideology and institutions, inclusion and efficiency, regional integration and respect for sovereignty. If ASEAN views this as an opportunity rather than a crisis, it will need to confront its own institutional fatigue and functional fragmentation. ASEAN will also need external partners, including Japan, to offer practical support in upholding the bloc's ideals.
SUKEGAWA Seiya is a professor at the Faculty of Political Science and Economics, Kokushikan University and a visiting professor at Thai-Nichi Institute of Technology.