Abstract
The Timor Leste has been an independent state and is separated from Indonesia after referendum. It does not mean that people of the new state do not have relation with Indonesia such as trade, social and cultural relations, especially people staying in border areas. Beside nostalgia in the past to make both sides always do interactions in many things, trade contact conducted by the communities of the two regions due to the differences in potential resources and manufacture production. With these differences, transnational trading-which is the focus of this study-is something unavoidable both legal and illegal. The transnational trading appears if spesific commodity in a certain country can not be found in other countries, or although this commodity is resulted in the country, the volume is relative small so that the efforts to develop it need production cost which is more expensive than it if it is compared to importing attemps. The same case is the domestic commodity which can be sold to the foreign countries if the price of the commodity abroad is more expensive than it in the country. The above phenomenon happens both to Indonesian and Timor Leste people staying on the border areas. However, trading interaction of both sides is still on traditional system and in small volume. This economic activity is conducted just as subsistent economic and not commercial economic. This paper attempts to answer on why do trading activities be done, what kind of commodities which are traded, and who does get the opportunity from this activity? this paper is based on the field research to Belu District in 2005 and 2006, and is added with my literature study as well.