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UPDATED: October 14, 2014 NO. 39 SEPTEMBER 25, 2014
Aiming Higher, Going Larger
The Shanghai Cooperation Organization seeks new development opportunities at its annual summit
By Bai Shi

TEST FIRE: Chinese artillery troops shoot at targets on a training base in north China's Inner Mongolia Autonomous Region during the SCO Peace Mission 2014 joint antiterror drill on August 29 (SU XIANGDONG)

Growth opportunities

Economic cooperation is the other driver for the SCO's development. Xi called on SCO countries to adhere to the goal of common progress and prosperity at the summit.

"Pushing the two wheels—cooperation in security and the economy—to run forward synchronously is a major agenda for the SCO," said Pan Guang, Director of the Center of SCO Studies under the Shanghai Academy of Social Sciences.

At present, there are three international cooperation frameworks in the Central Asian region. They are the multilateral economic cooperation mechanism led by the SCO, the Eurasian economic union initiated by Russia, and the China-proposed Silk Road Economic Belt.

China's vision of building an economic belt along the Silk Road, an ancient trade route that ran through nearly 30 countries in Central Asia, South Asia, West Asia, Europe and North Africa, has been met with a positive response from many countries, including SCO member states, since Xi put forward the proposal last year.

The proposal is a supplement to existing SCO economic cooperation regimes, reflecting China's innovative thinking on regional economic cooperation, Sun said.

"The proposal is not meant to establish a new mechanism or an integration organization," Sun said. "The Central Asian region has complicated geographic features and large differences in economic strength between countries, as well as many challenges in economic development. However, these landlocked countries hope to achieve economic growth through international cooperation. In particular, they expect to improve traffic conditions with the help of foreign investment."

According to him, based on the principle of mutual benefits, common development and opening up, China and Central Asian countries can usher in a new model of international economic cooperation. But Sun acknowledged that it requires long-term efforts to build the proposed economic belt.

An agreement on the facilitation of international road transport among SCO member states was also reached at the Dushanbe summit. The agreement is expected to build a traffic trunk from the Baltic Sea to the Western Pacific Ocean, from Central Asia to the Indian Ocean, which will promote economic cooperation and traffic linking between the SCO member states.

Promoting trade between member states is the primary task for SCO economic cooperation, and robust trade growth is proof of the remarkable achievements made thus far, said Liu Huaqin, a researcher with the Beijing-based Chinese Academy of International Trade and Economic Cooperation.

According to the World Trade Organization's International Trade Statistics 2012, trade between SCO member states had realized high-speed growth since 2003. Trade between all six member states of the SCO exceeded $4.9 trillion in 2012, increasing 4.49 times from 2003. The figure is higher than the average global trade growth, 2.39 times, in the same period.

In addition to economic growth, people's quality of life remains a focus of SCO economic cooperation. In recent years, Chinese enterprises have contracted many major projects in Central Asian countries. These projects provide a win-win result for both investors and local people.

For example, a Chinese electricity equipment producer built an extra-high voltage electricity transmission and transformation network in Tajikistan in 2009. The project helped end north Tajikistan's dependence on neighboring countries for power generation.

Despite positive attitudes toward economic cooperation, there are many difficulties for the SCO in implementing multilateral proposals due to differences in terms of economic strength and industrial structure between member states, Sun said.

New members

"The SCO is an open regional intergovernmental organization. As for membership enlargement, the SCO has taken a positive but prudent attitude," Sun said.

The SCO has aimed to address security issues in border areas of the six member states from the beginning. As a young regional group, the SCO has been making efforts to improve its coordination and cooperation mechanism since its inception. Some countries, such as India, Pakistan and Iran, have expressed willingness to join the group for years.

Its working mechanism is a reason why the SCO has not added new member states. The SCO adheres to the principle of reaching a negotiated consensus among all member states. As long as there is one member state saying no, the SCO cannot carry out a proposal of membership expansion, Zhao Huirong, a researcher of Central Asian issues with the Chinese Academy of Social Sciences told Beijing Review.

However, from 2001 to now, the SCO has been expanding cooperation with more countries. It now has six members, five observers and three dialogue partners, proving the greater vitality of the group. The SCO's "Shanghai Spirit" of mutual trust, mutual benefit, equality, consultation, respect for cultural diversity and pursuit of common development is recognized and backed by all member states and applicant countries, Zhao said.

On September 12, Indian External Affairs Minister Sushma Swaraj formally submitted an application for India's full membership to the SCO in Dushanbe.

According to Indo-Asian News Service, Indian External Affairs Ministry spokesman Syed Akbaruddin said, "It is our expectation that we will be able to contribute to the SCO in a better capacity once the SCO opens up its membership to other countries."

"India sees the SCO as a forum where it can work regionally on several aspects, such as regional antiterror mechanisms," Akbaruddin said.

India and Pakistan are expected to become new member states of the SCO next year, according to Pan.

SCO Quick Facts

The Shanghai Cooperation Organization (SCO) is a permanent intergovernmental international organization, which was established by six original member states in Shanghai on June 15, 2001. The SCO's prototype is the Shanghai Five mechanism launched by China, Russia, Kazakhstan, Kyrgyzstan and Tajikistan in 1996.

The SCO aims to promote international cooperation in broad fields between member states and explore a new, democratic, just and rational political and economic international order in the Central Asian region. The SCO adheres to the "Shanghai Spirit" as its principle for carrying out cooperation, consisting of mutual trust, mutual benefit, equality, consultation, respect for cultural diversity and pursuit of common development.

The SCO member states cover a total area of 30.18 million square km, accounting for three fifths of the Eurasian region. The total population of the SCO amounts to 1.53 billion. In 2013, the total GDP of the SCO member states exceeded $11 trillion.

Member States: China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan

Observer States: Afghanistan, India, Iran, Mongolia and Pakistan

Dialogue Partners: Belarus, Turkey and Sri Lanka

(Compiled by Beijing Review)

Email us at: baishi@bjreview.com

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