At the Shanghai Cooperation Organization Summit in Astana in July 2024, the President of China Xi Jinping called for the creation of a common home characterized by solidarity, mutual trust, peace, tranquility, prosperity, development, good neighborliness, friendship, fairness, and justice. To emphasize this vision, it is necessary to pay attention to the provisions on economic relations.

When the Shanghai Cooperation Organization was established in 2001, its primary objective was to enhance regional security and stability. Over time, its mission has expanded to include economic cooperation, recognizing that shared development is inextricably linked to sustainable prosperity and stability.

Today, the SCO is the largest regional organization in terms of territory and population, with an extensive market, diverse resources, and growth potential. One of its primary objectives is now to foster trade and investment among member states. To achieve this, initiatives such as the SCO Business Council and the Interbank Association have been established to promote cross-border trade and financial cooperation. The volume of trade between China and other SCO member states, observer states, and dialogue partners reached a record high of $890 billion in 2024. This accounted for 14.4 percent of China’s total exports and imports, demonstrating the viability and prospects of intraregional trade.

Cooperation within the SCO has also contributed to the development of infrastructural connectivity across Eurasia. Iconic transport networks such as the China – Central Asia – West Asia Economic Corridor and the China – Kyrgyzstan – Uzbekistan Railway have significantly reduced trade barriers. Well-developed energy infrastructure, such as the China – Central Asia gas pipeline and the East Russia – China gas pipeline, ensures the energy security of the region and stabilizes global energy markets. The SCO member states recently signed a Memorandum of Understanding on the joint construction of Silk Road Stations to address critical infrastructure gaps along the rapidly expanding trade corridors. In addition, the SCO has facilitated the coordination of development strategies.

The Belt and Road Initiative (BRI) proposed by China is closely aligned with the development strategies of other SCO member states. Sustainable development has become a new priority of the SCO, with green and digital development being the top priorities. Over the years, the SCO members have achieved significant success in green development. According to a report published during the SCO Energy Ministers’ meeting in June this year, the total installed capacity of renewable energy in the SCO countries by the end of 2024 was 2.31 billion kW, which is about half of the global total. The SCO Green Forum is a platform for members of the organization to discuss development directions as green development partners and further align with the organization’s Green Agenda.

Digital development is another growing area for the SCO. Initiatives such as the SCO Digital Economy Forum and the Digital Silk Road play a crucial role in bringing together the Eurasian digital economies. Cross-border e-commerce between China and other SCO member states increased by 34 percent in 2024 compared to the previous year. SCO members are also promoting the digital transformation of the group. For example, the SCO member states’ Action Plan on Digital Transformation, adopted in June, encourages further cooperation in e-commerce, artificial intelligence, and intellectual infrastructure.

Despite the progress, the SCO still faces obstacles to greater economic integration. To better address various challenges, the SCO can strengthen institutional mechanisms to enhance connectivity in five priority areas: politics, infrastructure, trade, finance, and people-to-people relations. This will enable better alignment of competitive advantages and foster stronger mutual understanding and trust.

It is expected that the upcoming SCO Summit in Tianjin, which China will host as the rotating chairperson of the SCO, will further unleash the enormous potential of the group. As the SCO aims to build a common home characterized by prosperity and development, members have a common foundation to counter protectionist tariffs, unilateral sanctions, and technological restrictions, while deepening economic cooperation to improve the well-being of people in the region. More importantly, as an advanced regional organization of the Global South, the SCO’s overall development model offers an alternative to Western exclusive clubs. It demonstrates that multilateralism, with the proper structure, can yield tangible development outcomes for all participants.

G.Khonnazarov, UzA