How Timor-Leste Leverages $18 Billion in U.S. Investments to Shape Its Democratic Future
Timor-Leste, also known as East Timor, maintains a relationship with the United States that extends far beyond diplomacy. This young Southeast Asian democracy has directed nearly all of its national reserves—approximately $18 billion—into the U.S. economy, including investments in hundreds of American companies. The nation also uses the U.S. dollar as its official currency, linking its economic stability directly to America’s fiscal health.
H.E. José Luís Guterres, Ambassador of Timor-Leste to the United States,brings a rare depth of experience to this relationship. Having served as Ambassador, Foreign Minister, Deputy Prime Minister, and Member of Parliament, he has witnessed Timor-Leste’s transformation from post-independence challenges to a country with a growing international presence. Returning to Washington for his second diplomatic assignment, he offers insights on global affairs, regional security, and economic strategy from the perspective of his island nation, known locally as “Timor Lorosa’e,” or the “Rising Sun.”
In this interview, Ambassador Guterres explores why U.S. economic performance matters to his people, Timor-Leste’s progress toward ASEAN membership, and the surprising scarcity of American businesses in a country that exports coffee to the United States. He also shares his vision for the country’s young democracy and offers guidance for the next generation of Timorese leaders.
Ambassador Guterres, this is your second time representing Timor-Leste in Washington. How does your return to this post compare with your first assignment after independence?
Thank you very much for the opportunity. The first time I came here as Ambassador was in 2003, when I presented my credentials to President George Bush. At that time, I was also Ambassador to the United Nations. In 2005, I returned home to serve as Foreign Minister, later Deputy Prime Minister, and then a Member of Parliament.
From 2003 until now, of course, much has changed. Personally, I have gained experience, and the United States has gone through its own changes. We now have a new administration under President Trump, and with each administration come new policies. As diplomats, we always wish the government in place success, because progress in America contributes to a safer world.
For us in Timor-Leste, this is particularly direct. Since our independence in 2002, we adopted the US dollar as our national currency. If the US economy or its policies face challenges, that affects the stability of the dollar and, in turn, our stability. In addition, we have invested heavily in the United States for many years—both in Treasury bonds and equities. Few people know that Timor-Leste has around 18 billion dollars invested in the US, including shares across some 600 American companies.
So yes, we have a direct stake in the development of the United States and in its people’s progress. We also look to the United States to continue playing its role in promoting peace, not only in the Middle East and Ukraine, but also in Southeast Asia, where we belong. We hope to see peace between Israel and Palestine as well. It is not easy, but there is no other solution than for both to live side by side with respect.
You have served as Ambassador, Foreign Minister, and Deputy Prime Minister. Which experience most shaped how you approach diplomacy today?
Every position has taught me something. Serving as Foreign Minister, Deputy Prime Minister, Ambassador, and Member of Parliament gave me insight into how societies interact and how tolerance is essential. There will always be disagreements, but we must find ways to live with them.
In international relations, I learned that respect is fundamental—respect for cultures, religions, and traditions. I also learned that problems are best addressed early, before they grow larger and harder to resolve. Anticipation and vision are critical, not just for one’s own country, but for the global community.
The world changes quickly, sometimes weekly, and you see it not only in the United States but worldwide. That is why I value dialogue. For example, I believe President Trump and his administration deserve credit for bringing Russia, the European Union, and Ukraine to the table. Negotiations will take time, but the fact that they are talking is already progress.
Europe has been the site of major wars in the past—the First and Second World Wars. We must ensure there is never a third. The United States, as President Trump has said, does not want war but peace. That gives hope.
Beyond defense and security, where do you see the greatest opportunities for deeper U.S.–Timor-Leste cooperation in the coming years?
We already enjoy excellent cooperation in military and security matters. The US Navy has built schools in Timor-Leste and trained with our defense force alongside partners such as Portugal, Australia, Indonesia, and China. We also work closely with the FBI. One of our officers recently attended the FBI Academy in Quantico. This type of cooperation—on defense, policing, and combating transnational crime—is what we hope to expand further.
Trade is more modest. Our exports to the United States amount to about 5 million dollars, mainly in coffee, while we import roughly 15 million dollars in poultry. My Prime Minister, Xanana Gusmão, often said tariffs are not our main concern. Our greater concern is the stability of the dollar, since it is our currency.
What is often overlooked is our own investment in the US. For a small and relatively poor country, Timor-Leste has invested nearly all its reserves in US Treasuries and equities across hundreds of companies. That shows how deeply linked we are.
Timor-Leste is preparing for ASEAN membership. What progress has been made toward this goal, and what kind of support would help the process?
We formally applied to join ASEAN in 2011, during Indonesia’s presidency. Since then, we have been aligning our laws and ratifying treaties. Just recently, our Deputy Foreign Minister presented dozens of agreements to Parliament for approval, including the ASEAN Charter.
The final decision is expected this October, during Malaysia’s chairmanship. For Timor-Leste, this is a long-held dream. ASEAN represents a dynamic bloc of about 700 million people and an economy of around 5 trillion dollars. Even during times of global decline in foreign direct investment, ASEAN has continued to attract capital. That speaks to its resilience and success.
For us, joining ASEAN will be an opportunity to learn from neighbors such as Singapore, Brunei, Malaysia, Indonesia, and others. As our President – José Manuel Ramos-Horta– once remarked, “To enter ASEAN is more difficult than going to heaven.” After many years, we are close to making that dream a reality.
Your country is working to diversify its economy beyond oil and gas. Which sectors hold the strongest potential for growth and investment?
We are focusing on agriculture, education, and health. Our population is young, so education and training are vital. At the same time, agriculture must be developed. We spend hundreds of millions of dollars importing food, including rice, even though our land is fertile. With better irrigation and investment, we could reduce imports and feed our communities ourselves.
We are also attracting interest from investors in India, Malaysia, and elsewhere to establish factories. Once we join ASEAN, we expect more foreign direct investment to come our way.
In the United States, we are engaging with the US–ASEAN Business Council to encourage American companies, both large and small, to look at Timor-Leste. Ironically, although we invest in 600 American companies, there is very little American presence in Timor-Leste—no Starbucks, for example. Yet we sell coffee to the US.
Timor-Leste offers a peaceful, friendly environment with extraordinary natural beauty. In a short drive, you can go from hot coastal areas to cool mountain valleys. Our name in Portuguese is Timor-Leste, but in our traditional language, Tetum, it is Timor Lorosa’e—“Timor of the Rising Sun.”
Timor-Leste is often cited as a young democracy. How do you see its democratic institutions evolving over the next decade?
We are proud of our democracy. Since independence in 2002, we have held regular elections every five years without coups or illegal changes of government.
Our democratic system was not improvised. As far back as the late 1980s, resistance leaders decided that after independence we would have a multi-party system. That principle was enshrined in our Constitution, and it remains dynamic.
Youth play an essential role. Just recently, university students protested against Parliament’s decision to purchase new cars. They demanded funds be redirected to productive sector of the economy instead. Thousands marched, and eventually Parliament agreed to reconsider the decision.
What struck me most was that after the protest, students cleaned the streets themselves. They also raised our national flag and sang the anthem, showing their patriotism even while disagreeing with government policy. That spirit of dialogue, respect, and civic responsibility gives me confidence that our democracy will grow stronger.
What role are young people playing in shaping Timor-Leste’s future, and how do you envision greater opportunities for them at home and abroad?
My advice to young people is to stay engaged. Do not only focus on studies—follow government and parliamentary decisions as well. Policies made today will shape your future. Speak up, demonstrate peacefully if you must, but avoid violence or destruction. Dialogue is always the way forward.
I have met Timorese students in the United States who excelled in their fields. Some became professors, engineers, or entrepreneurs. This shows our country has talent. The task now is to provide space and investment in education and vocational training so young people can develop their skills.
Finally, what message would you like to share with Americans who may not yet be familiar with Timor-Leste?
Timor-Leste is a peaceful and stable country with welcoming people and breathtaking landscapes. We have mountains, valleys, beaches, and a rich culture. We offer incentives for investors, and although we invest heavily in the United States, few American companies are present in our country.
I invite Americans to visit Timor-Leste—discover its beauty, meet its people, and explore opportunities. You may even find yourself wanting to stay longer, enjoying what I like to call a permanent holiday.
