East Timor has not shut the door on Labor's plan to establish a regional processing centre for asylum seekers there, with Prime Minister Xanana Gusmao saying he is still prepared to discuss the idea.
"What we say is that if there are ideas ... come with these ideas and we can discuss," he told ABC Radio on Thursday.
Mr Gusmao played down opposition to the plan from the fledgling nation's parliament and President Jose Ramos-Horta who warned in July that his country should not become a prison for Australia's asylum seekers.
East Timor has said Australia would have to meet the cost of the processing centre and it would need to be sanctioned by the United Nations High Commissioner for Refugees.
The most likely location for the centre would be on the nation's undeveloped south coast.
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The regional processing centre is the centrepiece of Labor's border protection policy. The coalition has dismissed the policy saying it will never happen.
Instead, a coalition government would reopen the Australian-built centre on Nauru.
