Dili: The Morrison government will throw East Timor a digital lifeline and spend millions to fund the laying of a first sub-sea fibre optic cable connection to the tiny island nation.

The construction of the cable, a crucial piece of infrastructure in a nation which relies on satellite links for its appallingly slow internet connection to the world, is one of several announcements the prime minister is due to make when he arrives in East Timor on Friday.

East Timor’s Presidential Palace will host celebrations on Friday to commemorate the 20th anniversary of the nation’s independence.Credit:AAP

It comes after Australia last year stepped in to fund two-thirds of the cost of a fibre optic connection to Papua New Guinea and the Solomon Islands, a move designed to assist in the development of those two nations – and to head off Chinese involvement in the project.East Timor is another nation increasingly looking to China as a source of investment.

The cable will link East Timor into the existing North-West Cable System, which runs from Darwin to Port Hedland. The funding is expected to be a loan.

While the government has not revealed the precise value of the project, a sub-sea fibre optic cable to Papua New Guinea and the Solomon Island’s cost $133 million for 4700km of cable. The East Timor cable is likely to extend less than 500kms.

Ahead of the announcement Fidelis Magalhães, the minister for Legislative Reform and Parliamentary Affairs in East Timor, welcomed the prospect of Australian assistance in constructing an undersea cable and the closer cultural links – and benefits to the economy – it would bring.

Mr Morrison will meet East Timor's Prime Minister Taur Matan Ruak in Dili and the pair will exchange diplomatic notes that will finally settle the maritime boundary between the nations.

This will clear the way for the Greater Sunrise oil and gas field to be developed, with 70 per cent of the revenue expected to flow to East Timor.

How that project will be funded, however, is still an open question with concern that commercial operators will not step in to provide the funds and that China may step in to help fund it. There are also concerns the government of Timor could attempt to fund most of the project and in so doing, exhaust its petroleum fund.

Mr Morrison will also announce a so-called maritime security package, which will include Australian support for the construction of new naval facilities at the Hera Naval base on Timor's north coast.

This will happen ahead of Australia giving two Guardian class patrol boats to East Timor into 2023.

The World Bank forecast the improved internet access in Papua and the Solomons could contribute US$5 billion to the Pacific economy and create close to 300,000 new jobs by 2040 and improve business opportunties, long-distance education and access to tele-medicine.

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