Timor-Leste Economic Report : Leveling Up - How ASEAN Membership Can Support Timor-Leste’s Economic Transformation

Overview & Synopsis

Timor-Leste is entering a new and potentially transformative economic chapter. Oil and gas production from the offshore Bayu Undan field has ended and the country now faces the task of building a durable foundation for prosperity - one driven by productive firms, exports, and a skilled workforce. The Tasi Mane project, including the development of a liquefied natural gas plant, remains a strategic national priority with the potential to anchor long-term revenues while strengthening energy security. Its fiscal contribution is, however, unlikely to materialize in the medium term. This edition of the Timor-Leste Economic Report argues that the country stands at a critical moment. Timor-Leste joined the Association of Southeast Asian Nations (ASEAN) in 2025, following the country’s accession to the World Trade Organization (WTO) in 2024, providing a timely platform to accelerate its transition from an oil-dependent economy to one driven by productive firms, exports, and skills. International experience shows that such transitions can succeed when regional integration drives domestic reforms. By treating ASEAN membership as a reform platform now, not later, Timor-Leste can build a more competitive, job-creating economy, and secure its long-term prosperity.