I. Overview of Economic and Trade Relationship Between China and Timor-Leste

The bilateral trade volume between China and Timor-Leste in 2003 was 1.067 million U.S. dollars. In 2004, the number increased 60.1% and reached to 1.709 million U.S. dollars. Both of which were China's export. Compared to that of the last year, the bilateral trade volume in 2005, all China's export, was 1.27 million U.S. dollars, which declined 25.5%, while this number had a rapid increase, with totaling 16.758 million U.S. dollars in 2006, of which China exported 5.794 million U.S. dollars and imported 10.964 million U.S. dollars. In 2007, the bilateral trade volume fell to 9.507 million U.S. dollars, decreased by 43.3%, indicating that the bilateral trade and economic development was still unstable. In 2009, from January to September, China's exports to the Timor-Leste is 7.34 million U.S. dollars, which is a 185.4% increase compared to the same period of 2008. The imports from Timor-Leste is 29 thousand U.S. dollars (almost no imports from Timor-Leste a year ago), and the predicted annual bilateral trade volume, mainly China's exports to the Timorese side, will reach nearly 10 million U.S. dollars, among which, the main export items are garments, bags, daily necessities, electrical and mechanical products, construction materials etc.

In early 2008, the Chinese Government gave zero-tariff treatment to 278 kinds of merchandise (originally produced in Timor-Leste) exported to China, but as the structure of Timorese exports is too limited and the major export product is coffee, the current export to China is very little.

In 2008, a Chinese company won the bid for Timor-Leste national power plant and power grid project which is the largest government investment project since its founding. The total contract amount is 360 million U.S. dollars and is expected to start construction by the end of 2009.

As it is not long time after the founding of Timor-Leste, and many political unrests occurred, China's investment in Timor-Leste is not yet of sufficient size, mainly individual businessmen carrying out investment business, which focused on hotels, petrol stations, supermarkets, fishing, restaurants, bars, brick factory, building materials, hardware and so on, with a preliminary estimated total investment of some 10 million U.S. dollars, meanwhile, some businessmen are interested in agriculture and mining industry investment opportunities.

Ⅱ. Chinese assistance to Timor-Leste

Since the independence of Timor-Leste, a number of economic and technological cooperation agreements have been signed between the two governments, and China has provided a certain amount of grant.

Construction Projects under the Chinese Aid:

1. The Office Building of the Ministry of Foreign Affairs of Timor-Leste

The project, which started in August 2006 and delivered to use in March 2008, with the construction area of 6700 square meters, is the most modern office building in Timor-Leste so far and the new "International Conference Center " in the country.

2. The Presidential Palace

By the end of 2007 the project started, and in August 2009 it has put into use, with the construction area of 3800 square meters. This building has become a new landmark in the capital of Timor-Leste, and it is also the place in which a variety of major state event are organized.

3. The Project of the Accommodation for F-FDTL of Timor-Leste

With the construction area of more than 9200 square meters, this project finished its foundation on 27 November 2009, and is expected to start constructing in early 2010, which will be the first true sense of Timorese residential quarters.

4. The Office Building of Ministry of Defense and F-FDTL

The project has been completed the preliminary design with the total construction area of about 5800 square meters, and is expected to start construction in the second half of 2010.

5. The Elementary School

The total construction area is about 1,200 square meters with nine classrooms, and is expected to start construction in the first half of 2010.

Material assistance:

The Chinese side has presented successively to Timor-Leste agricultural machineries, agricultural implements, pesticides, fishing gears, police uniforms, police communication equipments and many other batch materials. During the food crisis in Timor-Leste, China provided three times assistance with a total of 8,000 tons of rice and 50 tons of edible oil and other emergency humanitarian assistance, as well as a certain amount of anti-malaria medicines and so on.

Training and Human Resource Support:

In recent years, the Chinese Government has invited the Timorese officials and technicians to attend training programs held in China for developing countries. More than 600 people have participated in various programs.

Technical assistance:

The Chinese Government has sent agricultural experts to carry out agricultural technical maintenance in Timor-Leste. Since 2004, a long-term dispatch of Chinese medical team has been sent to Timor-Leste. From 2008, the hybrid rice experts have been sent to Timor-Leste to demonstrate and promote hybrid rice technology.