Relations with Indonesia are progressing strongly, with issues such as the return of refugees to be settled within months, Foreign Minister Jose Ramos Horta said yesterday. Mr Ramos Horta, on a private visit to Hong Kong before the Asean Regional Forum in Brunei on Monday, said Dili and Jakarta were involved in numerous negotiations. There had been no border incursions since East Timor became the world's newest nation on May 20 and diplomatic visits proved the relationship was improving. Indonesia's sometimes brutal 24-year occupation of the former Portuguese colony ended in 1999 after an overwhelming vote for independence by East Timorese. The referendum was marred by killings and violence by Jakarta-backed gangs which forced thousands of people to flee to the neighbouring Indonesian province of West Timor. Relations with Indonesia remained frosty until Indonesia's President Megawati Sukarnoputri attended Dili's independence celebrations. Last month, her East Timorese counterpart, Xanana Gusmao, went to Jakarta, where he called for reconciliation. 'Xanana got a warm welcome,' Mr Ramos Horta said. 'No problems exist with Indonesia. Only about 400 refugees remain in West Timor and all those who want to return will be back within a few months.' He was hopeful the Jakarta-based criminal court trying generals and senior officials accused of being behind the 1999 unrest would reach a fair verdict. He said some people were sceptical that the court would provide proper justice, but he was confident the international community would ensure the correct outcome. However, ties with Australia seem less smooth. Although an agreement has been signed on revenues from oil reserves in the Timor Gap, talks on a disputed boundary have yet to begin. Mr Ramos Horta said negotiations would start next month and although East Timor held just 20 per cent of the territory containing the rich oil and gas reserves and was seeking 100 per cent, he was sure a deal would be reached. An agreement already signed with Australia guarantees East Timor 90 per cent of the revenues from the Timor Sea oil and gas reserves. Within two to three years, they will generate between US$20 million (HK$156 million) and US$40 million a year for East Timor, which is among the world's poorest countries. Mr Ramos Horta also was confident his nation would be granted observer status with the Association of Southeast Asian Nations within months and full membership in about five years. His call earlier this year for the release from house arrest of Myanmar's opposition leader Aung San Suu Kyi infuriated the ruling junta, which vowed to block East Timor's membership. Mr Ramos Horta said he would meet his Myanmar counterpart in Brunei and was confident the issue could be resolved. He also said Hong Kong philanthropist Sir Eric Hotung had accepted the post of East Timor's honorary consul in the SAR and would take up the position in September. He praised Sir Eric for his support of East Timor and said he had also been appointed to an ambassadorial role under which he would promote East Timor in the region and the United States.