SCO to play larger global role

Updated 2017-06-08 09:30:02 Global Times
Trade with SCO members (2016)

Trade with SCO members (2016)

B&R initiative helping regional ties: yellow book

The Shanghai Cooperation Organization (SCO) will play a more important role in the world economy and will strengthen efforts to expand cooperation with countries and regions along the route of the Belt and Road (B&R) initiative in sectors including finance, infrastructure and capacity, experts said.[Special coverage]

On Thursday, Chinese President Xi Jinping is to attend the 17th Meeting of the Council of Heads of the SCO in Kazakhstan, during a state visit to the country from Wednesday to Saturday.

The two countries will sign agreements on trade, the economy and water conservation during President Xi's visit, according to China's Foreign Ministry. Xi will also attend the opening of the Astana Expo 2017.

The SCO will enter a new stage of development as the organization is set to accept India and Pakistan as full members, bringing the membership to 44 percent of the world's population and 25 percent of its GDP, People's Daily reported, citing a yellow book report released Tuesday. The SCO will have eight members after they join.

The yellow book was jointly compiled by the Social Sciences Academic Press and the Institute of Russian, Eastern European and Central Asian Studies under the Chinese Academy of Social Sciences.

The membership process for India and Pakistan started in 2015.

"The participation of the two big South Asian countries in the SCO will help expand the economic and trade cooperation in Asia generally," Chen Fengying, an expert at the China Institutes of Contemporary International Relations, told the Global Times on Wednesday.

"In terms of economic development and complementarities, India and Pakistan are actively seeking opportunities to strengthen cooperation with other countries in Asia," Xia Yishan, a research fellow of Central Asian studies at the China Institutes of International Studies, said on Wednesday.

For example, India wants to take advantage of the platform to import commodities from Central Asian countries such as Uzbekistan due to its lack of resources such as mineral products, Xia noted.

However, "We need to take a cautious view of the simultaneous entry of India and Pakistan as concerns over their bad relations due to territorial issues and other factors are obvious," Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation of the Ministry of Commerce, told the Global Times on Wednesday.

Financial ties

Despite the sluggish world markets, the economic development of SCO members is recovering, according to the yellow book.

The downward trend of Russia's economic development eased in 2016 and the economic growth of Kyrgyzstan, Tajikistan and Uzbekistan kept rising during the same year, with growth rates of 3.8 percent, 6.7 percent and 7.8 percent, respectively, said the yellow book.

Although the decline in foreign trade among SCO members also narrowed last year, member countries' debt risks are still high, the yellow book said. For instance, the foreign debts of Tajikistan and Kyrgyzstan reached .3 billion and .765 billion, respectively, the yellow book noted.

"For SCO members, cooperation in the financial sector will be a future trend with better prospects," Chen said, noting that member countries can strengthen their economic cooperation through establishing an investment bank and taking measures to facilitate trade convenience in areas such as customs, border tax and e-commerce.

"Investment banking is a good way to promote financial cooperation since it is market-oriented and member countries can shoulder responsibility through shares in it," Chen noted.

"China has accumulated enough experience in running investment banks and we have fostered sufficient talent in the area to be capable of realizing the bank plan if member countries agree to it," she added.

B&R drive

Many SCO members are participants in the B&R initiative, and the organization will promote the construction of the initiative smoothly, experts said.

"Bilateral cooperation among SCO members is basically going well but multilateral cooperation still needs great efforts," Xia noted.

The bilateral contact between China and countries along the B&R route is effective and productive in terms of releasing the potential of the economy, Chen said.

However, "we need to think about whether we can afford more resources for the SCO countries, given the scale of our investment in the B&R initiative," Mei noted.

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