It’s one of our closest neighbours and just a short plane trip from Darwin and it has a business environment ripe for the picking. Yet to most Australian companies putting together strategic business plans and looking for greenfield opportunities East Timor is way off the radar.

It’s a source of concern to former Victorian Premier Steve Bracks, who as a special adviser to the Prime Minister of East Timor, Xanana Gusmao, sees firsthand the billions of dollars in contracts that go begging in the country and more often than not are snapped up by Chinese and Indonesian companies.

At a boardroom lunch hosted by The Agenda Group and attended by representatives from some of Australia’s top companies, Mr Bracks outlined the business opportunities on offer in East Timor and the strategies companies, serious about bidding for work, need to adopt.

Despite a population of just over one million people East Timor’s wealth is much bigger – thanks largely to their natural resources. Their Petroleum Fund stands at around US$7.7 billion and is growing by around $250 million a month because of revenue from the Bayu Undan field in the Timor Sea. It’s reserves like this that have allowed the Government, which can’t borrow as it doesn’t have a credit rating, to begin to invest heavily in infrastructure projects.

While admitting there are challenges for companies who want to do business in East Timor, Mr Bracks pointed out that the Chinese have been in the country for a while setting up networks and building infrastructure such as the country’s first shopping mall, navy patrol boats and a power grid. He says Australian companies should have people on the ground in East Timor, establishing relationships at both the bureaucratic and political level, in order to be in a good position to tender for some large infrastructure projects which are in the pipeline.

Mr Bracks said the work carried out by the Victorian Employers’ Chamber of Commerce and Industry (VECCI) in helping establish a similar body for East Timor has been of enormous benefit and can act as a starting point for Australian businesses wanting to make a break into the country. VECCI President Peter McMullin also spoke at the lunch and backed up Mr Bracks’ point that the key to success in an emerging nation like East Timor was to get in early and establish yourself. VECCI has and continues to lead a number of trade delegations to East Timor and has a dedicated staff member based there to help businesses establish themselves.

Both men highlighted the turnaround in the country’s security situation – a concern that most businesses have when it comes to investing in previously war-torn countries – with Mr Bracks saying the situation had improved immensely.

While highlighting areas such as the development of a new port, repairing the ageing road network and upgrading the airport as on the Timor Government’s wish list, Mr Bracks said companies serious about looking to get into the East Timor market should read the country’s recently released strategic development plan which outlines the key opportunities.

2011 Timor-Leste Strategic Development Plan (SDP)