BOGOR (REUTERS) - Timor-Leste President Jose Ramos-Horta said on Tuesday (July 19) during a visit to Indonesia that he hoped to boost trade ties between the countries and seal a decades-long bid by his nation to join the Association of Southeast Asian Nations (Asean) next year.

Mr Ramos-Horta met his counterpart Joko Widodo on his first state visit to neighbouring Indonesia since he was elected in April for a second stint as president.

He previously served as president of Timor-Leste between 2007 and 2012.

"Timor-Leste as part of Southeast Asia has fulfilled many of the requirements necessary for a functioning economy and democracy so... will be a productive member of Asean," he said, noting he hoped his young country could join the group when Indonesia takes over the presidency next year.

Timor-Leste, which applied for Asean membership in 2011, currently holds observer status.

Speaking at the presidential palace in Bogor, south of Jakarta, the Indonesian president said his country had invested US$818 million (S$$1 billion) in Timor-Leste, mainly in energy, banking and communication businesses.

"We've agreed to increase trade between both countries," said Mr Widodo, who is widely known as Jokowi.

Official Indonesia data shows trade between the countries was worth around US$250 million last year.

Heavily dependent on revenue from oil and gas, the half-island nation of 1.3 million people has grappled with diversifying its economy and reducing high rates of poverty.

Mr Ramos-Horta, who won a Nobel Peace Prize for his peaceful efforts to end the conflict, said he welcomed deepening trade ties with Jakarta and Indonesia's commitment to Timor-Leste joining the 10-member Asean regional grouping.