Adam Gartrell – Australia should maintain a military presence in East Timor as late as 2020, a new report recommends.

The Australian Strategic Policy Institute says many of the problems that led to Timor's near-collapse in 2006 – and the subsequent Australia-led military intervention – remain potent.

Australia currently has around 400 Australian Defence Force members in East Timor but hopes to withdraw them soon after elections scheduled for 2012. But ASPI warns total withdrawal could pave the way for fresh unrest.

"A complete withdrawal may leave the ADF exposed to the risks of having to return at a later date," ASPI says. "Timor-Leste is currently relatively stable and looks set to continue more or less as it is. However, there remain a number of potential spoilers."

A relatively small presence could help prevent further crises and, failing that, orchestrate a rapid response to them.

Meanwhile, East Timor's defence force – known as F-FDTL – needs continuing ADF mentoring and training, the report says. Raising F-FDTL to UN peacekeeping standards would probably take to 2020 on current skill levels, it says.

"A small but highly effective dose of ADF prevention now would be more preferable... compared to a potentially larger, reactive dose in the future."

ASPI says Australia's diplomatic relationship with East Timor is currently good, despite antagonism from some Timorese officials. "Australia, for its part, needs to be seen as a benign, sympathetic and constructive partner, despite what are sometimes confronting provocations with its neighbour," the report says.

China's increasing influence in East Timor is a challenge to Australia's influence, the report goes on. But Australia should avoid competing directly with China for Timor's affections.

"Instead, the Timorese may need to be reminded, in more beguiling ways, of where Timor-Leste's true and most reliable friendships lie."