Indonesia expected Timor-Leste leaders and people to manage the crisis to regain stability, President Susilo Bambang Yudhoyono said on Friday.

"We hope the problem in Timor-Leste can be managed by the government's leaders and the people of East Timor themselves," Susilo told reporters.

The president, who recently ordered to open the border with Timor-Leste, said that the situation in the capital city Dili was now improved, which would positively impact on the future bilateral ties of the two countries.

"Certainly, with the development in Dili and the surrounding areas, the vigilance is increased, so there should not be problem that can make Indonesia difficult and make our bilateral relation difficult in future," he said.

"We want stable neighbor and the cooperation can be continued in good manner," he said.

Meanwhile, Indonesian Foreign Ministry's Director of Asia and the Pacific Region Yuri Thamrin said that he hopes Timor-Leste leaders judiciously consider the decision they would make so as to facilitate return of stability in the country.

The statement was made following Timor-Leste President Xanana Gusmao threatened on Thursday that he would resign if the embattled Prime Minister Mari Alkatiri refused to step down.

"We would like to underscore that whether the resignation happen or not, it should be considered very judiciously for the interest of ensuring the political stability of that country," said Thamrin.

Alkatiri, who heads the ruling Fretilin party that has an overwhelming majority in the parliament, has so far resisted the suggestion to resign.

The tiny nation was plunged into violence in May after the prime minister fired nearly 600 of the country's 1,400 armymen for mutiny when they protested about alleged discrimination against them.

Since then, the sacked troops and thousands of protesters have demanded resignation of Alkatiri as they held Alkatiri responsible for the violence that had seen youth gangs fighting, looting and burning buildings in Dili, which killed at least 20 people.

The situation has led to the arrival of 2,500 international peacekeeping forces led by the Australian troops.

Timor-Leste became independent from Indonesia in 2002, after two years under the United Nations transitional government following a referendum for independence.

Source: Xinhua