Sydney – Portuguese intelligence has warned of terrorist attacks against Australian, Portuguese and US interests in East Timor, the Australian Broadcasting Corp (ABC) said yesterday.

The warning that terrorists linked to the outlawed Islamic group, Jemaah Islamiah (JI), were planning attacks was said to have been contained in a leaked Portuguese army intelligence report, compiled in East Timor.

The report said that foreigners and business interests would be targeted in a series of attacks designed to coincide with significant dates, meetings and celebrations in East Timor between November and May.

Five targets in the capital, Dili, including a branch of the Australia and New Zealand Banking Group (ANZ), Portugal's Banco Nacional Ultramarino and popular bars, were identified.

Two suspects were named, including a former Indonesian soldier from West Timor-based Battalion 744, and a Pakistani national who had stayed previously at the main Dili mosque.

The two men reportedly had access to sophisticated communications equipment and planned to smuggle plastic explosives into East Timor from the Indonesian border town of Atambua in West Timor.

East Timor's Foreign Minister Jose Ramos Horta told the ABC that he was taking the threat seriously following the Bali bombing.

"East Timor is in many ways similar to Bali, it is a Catholic enclave that stands in the way of the fundamentalist strategy of converting or dominating the whole region, according to the analysis made in Washington or elsewhere," he said. "So on the basis of that, East Timor is a target for the extremists, fundamentalists in the region and in the world." Reacting to the report, the Australian Foreign Ministry said security had been stepped up at its embassy in Dili and that it had told Australians to "exercise extreme caution" in the country in light of "terrorist threats".

In its upgraded travel warning for East Timor, the Foreign Ministry said the threat "extends to a range of locations popular with foreigners, including City Cafe, Dom Aleixo Hotel, Central Boat, BNU and ANZ banks as well as the Australian and US embassies". It said "physical security" at the Australian Embassy had been upgraded in response to the threats.

The ministry also issued new travel alerts warning about the danger of terrorist attacks in the United Arab Emirates, Qatar and Libya.