New Zealand and Timor Leste have signed a five-year cooperation agreement aimed in part at helping reduce the Southeast Asian nation's reliance on oil.
Timor Leste, formerly known as East Timor, formally gained independence from Indonesia 15 years ago, after an armed intervention led by New Zealand and Australia.
Timor Leste Prime Minister Rui Maria de Araújo is in New Zealand and met with Prime Minister Bill English.
Dr de Araújo said the agreement signed with New Zealand covered many areas, including help to boost Timor Leste's organic coffee production and help with government budgeting.
He said the country needed to diversify its economy away from oil as reserves were running low.
"In the areas of agriculture, New Zealand is supporting small farmers to rehabilitate their coffee plantations, in the area of institutional strengthening they are supporting the justice sector to strengthen its capacity.
"Community policing, which is very strong here in New Zealand, is also part of this exchange."
The prime minister said he would visit the families of the New Zealand peacekeepers who died while serving in Timor Leste.
He said Australia had agreed to discuss Timor Leste's maritime boundaries, which could open up further oil and gas reserves.
"We are grateful that Australia is now willing to sit at the table and discuss those issues, it has done with all other neighbours except Timor Leste.
"So we expect that, now that they want to do that, we will be able to nail down some solutions during the next coming months."