Timor-Leste Risks Becoming Southeast Asia’s New Criminal Hub – Analysis

Dili, the capital of East Timor (Timor-Leste). Photo Credit: José Fernando Real, Wikipedia Commons

November 24, 2025 

By Geo Dzakwan Arshali and Ronan Timothy Asturias


Timor-Leste was officially welcomed as ASEAN’s 11th member on October 26, 2025, marking the bloc’s first expansion since Cambodia’s entry in 1999 and culminating a 14-year campaign by Asia’s youngest nation to join the Southeast Asian family. Though many applaud the country’s long-awaited inclusion, there is growing concern that its membership may add to the region’s already strained security agenda, and the bloc must prepare to confront these challenges collectively.


A Fragile Entry Amid Regional Instability

Timor-Leste gained independence in 2002 after decades of conflict, and from the start its leaders viewed ASEAN membership as critical for national security and development. Formally, the nation applied to join ASEAN in 2011, but faced years of delays as existing members questioned its readiness. Only in November 2022 did ASEAN agree “in principle” to admit Timor-Leste, granting it observer status pending preparations.

Dili enters ASEAN at a time when the bloc’s security agenda is already crowded and overstretched. Southeast Asia is beset by crises that have severely tested ASEAN’s bandwidth and unity, including the intractable violence of Myanmar’s junta, persistent tensions in the South China Sea, the renewed Cambodia-Thailand border flashpoint, and most notably the rapid spread of transnational criminal scam networks across the region.
The Criminal Pull Toward Timor-Leste

Crucially, Timor-Leste brings its own set of security vulnerabilities that differ from the traditional interstate conflicts ASEAN once focused on. On the positive side, the risk of inter-state conflict involving Dili is very low. Relations with its Southeast Asian neighbor Indonesia — which occupied the territory brutally from 1975 to 1999 — have normalized and are now largely cooperative, and its ties with Pacific neighbor Australia remain pragmatic.

Timor-Leste’s most significant security headwinds, however, lie in non‑traditional threats, with one urgent concern being its porous borders and maritime domain, since the young nation lacks the capacity to fully police its coastline and remote land borders. Global Organized Crime Index 2025 notes that the country has become a source, transit, and destination for smuggling, with organized syndicates increasingly active and corruption among border officials enabling illicit crossings.

Most worrying, furthermore, is evidence that transnational organized crime networks see Timor-Leste as a new frontier. As crackdowns elsewhere in Southeast Asia made headlines, criminals began casting an eye toward this small nation, betting that its weak regulations and hunger for investment make it easy prey.



In late 2024, Timor-Leste’s Special Administrative Region of Oecusse — a remote special economic zone surrounded by Indonesia — launched a free trade zone aimed at attracting foreign investors, and criminal groups moved in almost immediately. A police raid in August 2025 uncovered a large scam operation run by foreign nationals, with equipment identical to the fraud factories seen in Myanmar, Laos, and Cambodia.

Thereafter, UNODC reports that cybercriminals, offshore gambling groups, and triad-linked networks were backing shell companies in Timor-Leste to set up cyber-scam centers and illicit online casinos, a pattern that traps trafficked workers and mirrors the criminal model spreading across Southeast Asia.

Timor-Leste’s leaders have grown increasingly alarmed by these developments, specifically after a senior official Agio Pereira went public with an explosive warning in late September 2025 that foreign crime syndicates had funneled tens of millions of dollars into the country to bribe officials, secure fraudulent licenses, and carve out protected spaces for scams, gambling, and trafficking.
Why ASEAN Cannot Afford to Stand Back

Against this backdrop, it is unlikely that Dili can address such well-resourced networks on its own, given its underfunded police, weak regulatory oversight, and the sheer sophistication of the syndicates now operating on its soil. Without external assistance, the fear is that Timor-Leste could slip into becoming Southeast Asia’s next haven for organized crime.

ASEAN therefore cannot treat Timor-Leste’s problems as a domestic matter and must step in early to support its newest member in strengthening enforcement, closing regulatory gaps, and preventing the country from becoming another regional crime hub.

The concern, regardless, is whether ASEAN’s existing mechanisms for law enforcement cooperation are sufficient to meet this challenge The bloc does have frameworks in place — regular meetings of police chiefs (ASEANAPOL), periodic ministerial meetings and declarations on transnational crime, and even some joint operations or intelligence-sharing arrangements.

ASEAN member states, moreover, have a traditional Mutual Legal Assistance Treaty and newly signed Treaty on Extradition that, in theory, facilitate cooperation against cross-border crime. In practice, though, these mechanisms have often struggled to produce results against agile criminal syndicates. Coordination is often hampered by limited resources and the traditional ASEAN norm of non-interference, which can make authorities hesitant to intervene in a neighbor’s internal issues even when illicit networks cross borders.

ASEAN will need to rethink its approach if Timor-Leste’s entry is to strengthen rather than strain the region, starting with far tougher cross-border cooperation that treats scam networks and trafficking as shared security threats requiring joint investigations, swift intelligence-sharing, and real enforcement. Timor-Leste will also need major institutional investment, and ASEAN should make it the centerpiece of its integration programs by expanding police training and providing Dili with the administrative support it currently lacks.
A Defining Test and a Regional Opportunity

This is also a moment for ASEAN to update its norms, accept that non-interference cannot protect criminal sanctuaries, and allow Timor-Leste’s democratic voice to help push the bloc toward a more credible and collective security posture. Embracing Timor-Leste’s input and concerns will signal that ASEAN is serious about not leaving any member behind as a weak link in regional security.

While ASEAN recalibrates its strategy, Dili must also demonstrate it is serious about cleaning up criminal activity by shutting down scam operations, tightening oversight of investment in special zones, and prosecuting any officials found to be complicit, especially after its recent decision to ban online gambling. The nation must further strengthen security laws, but without repeating the regional pattern of using them to silence critics, because preserving its democratic character is central to its credibility in ASEAN and essential for mobilizing civil society against corruption and crime.

The coming year of 2026, with the Philippines as ASEAN chair — a country that has prioritized regional security and tackling transnational crime — offers a timely opportunity. Manila has the experience in combating organized crime and that the country should lead the bloc in pushing for deeper cooperation against scam networks.

Timor-Leste’s entry is indeed a defining test for ASEAN, which must show it can turn a fragile new member into a stable and contributing partner by tackling organized crime and strengthening institutions. Failure to do so, on the other hand, could see Timor-Leste drifting into the same category as the lawless scam enclaves in Cambodia, Myanmar, or Laos, which would be a regrettable outcome of ASEAN’s first expansion in over two decades.

About the authors:

Geo Dzakwan Arshali is Research Intern (Regional Security Architecture Programme) with Institute of Defence and Strategic Studies (IDSS) at S. Rajaratnam School of International Studies (RSIS). He is concurrently an Emerging Leaders Fellow at FACTS Asia and Senior Analyst & Program Manager at World Order Lab.

Ronan Timothy Asturias is Undergraduate Student in Asian Studies at Faculty of Arts and Letter, University of Santo Tomas Manila, and Analyst at World Order Lab. He currently serves as Co-Chair of the Asian Undergraduate Symposium (AUS) Fellows Society at the National University of Singapore.