Indonesia, Timor-Leste seal investment treaty to expand economic ties

Jakarta (ANTARA) - Indonesia and Timor-Leste have signed a bilateral investment treaty to deepen economic ties and encourage cross-border investment, the Indonesian Ministry of Investment and Downstreaming said.

The treaty was signed in Jakarta on Thursday by Indonesian Investment and Downstreaming Minister Rosan Perkasa Roeslani and Timor-Leste's Deputy Prime Minister and Coordinating Minister for Economic Affairs Francisco Kalbuadi Lay.

Rosan said the pact establishes a legal and institutional framework to deepen economic integration by aligning policies, streamlining regulations and accelerating investment.

"We believe there is tremendous potential for collaboration that we can explore and develop together," Rosan said.

The signing fulfills a commitment made in 2023. Formal negotiations began in November 2024 and concluded after a final legal review in August 2025.

Ministry data show that about 120 Indonesian private companies have invested in Timor-Leste.

Indonesian state-owned enterprises also operate businesses and manage strategic infrastructure projects there, including Bank Rakyat Indonesia (BRI), Bank Mandiri, Pegadaian, Telkomsel, Pertamina International Timor and construction firms Waskita Karya, PT PP and Adhi Karya.

Indonesia exports about US$150 million worth of motor vehicles, automotive parts, processed starch, and animal and vegetable oils to Timor-Leste. Timor-Leste exports coffee, tea, spices, machinery and mechanical equipment to Indonesia.

The treaty is expected to attract investment in downstream natural-resource processing, manufacturing, infrastructure, renewable energy, logistics, real estate and digital technology.

The governments also agreed to share investment information and promote business-to-business partnerships.

Lay welcomed the agreement, saying it strengthens longstanding bilateral ties and aims to ensure people on both sides of the border benefit directly from closer economic cooperation.

The Indonesia-Timor-Leste BIT rests on three pillars: investment promotion to foster a sustainable business environment, transparent and efficient investment facilitation, and investment protection ensuring fair treatment and legal certainty.

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Translator: Ahmad Muzdaffar, Uyu Liman
Editor: Rahmad Nasution
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