ASEAN’s newest member state Timor-Leste is driving economic development through a A$1 billion infrastructure and resources spend, plus the establishment of a new bank to support private sector investment.
The Government of Timor-Leste’s budget forecast gives priority to infrastructure and the energy transition, with US$223 million allocated to build roads and bridges and US$138.5 million to invest in renewable energy and power distribution networks.
This spending is crucial for economic development and connectivity with municipal areas, while addressing climate-related risks and impacts.
Driving economic development
Here is a breakdown of major infrastructure and resources development commitments:
- US$223 million allocated to build roads and bridges
- US$25.8 million allocated for water and sanitation programs
- US$138.5 million to upgrade and maintain power distribution networks, and invest in projects to diversify energy sources through renewable energy
- US$46.3 million in the airport sector to enhance connectivity and support growth in tourism, trade and industry
- US$43.4 million to promote food security and job creation
- US$37.1 million for decentralisation and municipal autonomy
- US$194.1 million on resources sector infrastructure and exploration.
Investing in the resources sector
The Government of Timor-Leste is courting private-sector investment in its emerging minerals industry. At the 2025 International Mining and Resources Conference (IMARC), it flagged a second licensing round for metallic and non-metallic minerals, which will be formally launched on 24 November 2025. Read the IMARC presentation by the Autoridade Nacional dos Minerais Timor-Leste, I.P.
Just this week, ASX-listed explorer and developer Tivan Limited expanded its footprint in Timor-Leste, purchasing new tenements in a transaction worth approximately $500,000.
Beyond support for minerals exploration, a significant proportion of the US$194.1 million resources investment will be allocated to key offshore projects.
In his address to National Parliament, Dili on 4 November 2026, H.E. The Prime Minister Kay Rala Xanana Gusmão highlighted the Government of Timor-Leste’s commitment to growing this sector amid a backdrop of a substantial but declining Petroleum Wealth Fund.
‘We will continue to capitalise on our petroleum and mineral wealth, with an investment of US$194.1 million in this strategic sector, supporting critical projects such as Tasi Mane, Greater Sunrise, and the Bayu-Undan transition, including future exploration and the construction of the gas pipeline to Timor-Leste,’ Prime Minister Gusmão said.
Timor-Leste presents its investment opportunities in resources at IMARC 2025. Image sourced from the Autoridade Nacional dos Minerais Timor-Leste, I.P. website.
Enabling economic reform and productivity growth
The Government of Timor-Leste has approved the establishment of the National Development Bank of Timor-Leste (BNDTL – Banco Nacional de Desenvolvimento de Timor-Leste). The bank was set up to address low private-sector lending rates and boost productive investment in the private sector.
This National Development Bank, according to the Prime Minister’s address to Parliament, is intended to finance projects with high economic and social impact, particularly in priority sectors such as agriculture, tourism, manufacturing, infrastructure and social services.
Other economic reform and productivity growth highlights include:
- US$181.7 million for the education sector, with a focus on technical and training institutes, to encourage entrepreneurship, especially among the younger population
- a new digital identification system connecting banks and mobile money providers, providing data interoperability among tax, customs, pension and civil registration systems, strengthening compliance and expanding the revenue base
- investment to operationalise national digital infrastructure, integrating submarine cables, terrestrial fibre, and universal digital access.
Opportunities for Australia to partner with Timor-Leste
Australia and Timor-Leste are close neighbours and partners, with shared history and strong people-to-people links. Australia has been at the forefront of international support for Timor-Leste since its independence on 20 May 2002 when diplomatic relations formally commenced. Australia is Timor-Leste’s largest development and security partner.
Timorese businesses are actively seeking partnerships with Australian businesses with advanced and innovative capability in climate-resilient infrastructure, energy transition and sustainable mining.
Austrade can support Australian businesses to diversify into new markets and build overseas networks through an international network of advisers. For more information on opportunities in Timor-Leste, contact Austrade.
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