Timor-Leste has been making steady progress towards socioeconomic growth, but a range of challenges abound. While the country has achieved relative political stability and is making efforts to improve its developmental outcomes by adopting a National Development Strategy, dependence on oil income, high poverty and unemployment rates and weak institutional structures pose considerable systemic risks. These developmental challenges are visible nowhere more so than in Oe-Cusse. An enclave nestled inside the Western Timor province of Indonesia and with an estimated population of 70,000, OeCusse’s economic and social development issues are deepened due to its geographical location, myriad institutional weaknesses and historically low public investments in services and infrastructure. To address these challenges in a concerted way and drawing on a Constitutional provision that accords special status to Oe-Cusse, in July 2014 the government promulgated a law establishing the Authority of the Oe-Cusse Special Administrative Region (SAR) and the Special Economic Zones for Social Market Economy (ZEESM).