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CouncilonForeignRelations,"CFRBackgrounders:TheShanghaiCooperationOrganization,"October14,2015|USChinaInstitute

CouncilOnForeignRelations,"CFR
Backgrounders:TheShanghaiCooperation
Organization,"October14,2015
TheCouncilonForeignRelationspublishedthebackgrounder,"TheShanghaiCooperation
Organization",toexplainwhattheShanghaiCooperationOrganizationisanditsroleinforeign
policytoday.ThepiecewaswrittenbyEleanorAlbert.
10142015

Introduction
TheShanghaiCooperationOrganization(SCO)isanintergovernmentalorganizationcomposed
ofChina,Russia,Kazakhstan,Kyrgyzstan,Tajikistan,andUzbekistanfoundedinShanghaiin
2001.Originallyformedasaconfidencebuildingforumtodemilitarizeborders,theorganization's
goalsandagendahavesincebroadenedtoincludeincreasedmilitaryandcounterterrism
cooperationandintelligencesharing.TheSCOhasalsointensifieditsfocusonregional
economicinitiativesliketherecentlyannouncedintegrationoftheChinaledSilkRoadEconomic
BeltandtheRussialedEurasianEconomicUnion.Whilesomeexpertssaytheorganizationhas
emergedasanantiU.S.bulwarkinCentralAsia,othersbelievefrictionsamongitsmembers
effectivelyprecludeastrong,unifiedSCO.
WhatistheSCO?
OriginallyorganizedastheShanghaiFivein1996,theorganizationaddedUzbekistanin2001
andrenameditselftheShanghaiCooperationOrganization.Thesixmemberstatesoccupy
territorythataccountsforthreefifthsoftheEurasiancontinentandhaveapopulationof1.5
billion,aquarteroftheworld'spopulation.Inadditiontothesixmemberstates,theSCOhastwo
newaccedingmembers,IndianandPakistan,fourobservernations,andsixdialoguepartners.
Aslaidoutinitscharter,theorganizationfunctionsasaforumtostrengthenconfidenceand
neighborlyrelationsamongmembercountriesandpromotecooperationinpolitics,trade,
economy,andculturetoeducation,energy,andtransportation.TheSCOhastwopermanent
headquarters,thesecretariatinBeijingandtheRegionalAntiTerroristStructure(RATS)in
Tashkent,theUzbekcapital.Oneoftheorganization'sprimaryobjectivesispromoting
cooperationonsecurityrelatedissues,namelytocombatthe"threeevils"ofterrorism,

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CouncilonForeignRelations,"CFRBackgrounders:TheShanghaiCooperationOrganization,"October14,2015|USChinaInstitute

separatism,andextremism.Theorganizationadoptsdecisionsmadebyconsensus,andall
memberstatesmustupholdthecoreprincipleofnonaggressionandnoninterferenceininternal
affairs.
Asayoungorganization,theSCOsregionalinfluenceremainslimited.RichardWeitz,senior
fellowanddirectoroftheCenterforPoliticalMilitaryAnalysisattheHudsonInstitute,writesthat
theSCOanditsmainorganizationalbodiesare"chronicallyunderfundedandhavelimited
powerstotakedecisionsindependentlyoftheirmembergovernments."Memberstates'penchant
forpursuing"microagendas"alsounderminesgroupcohesionandsowsmistrust,saysMatthew
Crosston,professoranddirectoroftheInternationalSecurityandIntelligenceStudiesProgramat
BellevueUniversity.
Despitethesechallenges,theSCOhasneverthelessbroadeneditsmandateinrecentyearsto
includejointsecurityandeconomicdevelopmentprograms.In2014,Chinahostedthebloc's
PeaceMission,itslargestmilitaryexerciseintermsofthenumbertroopsinvolved,morethan
seventhousand,andadvancedweaponrydeployed.Otherorganizationalprioritiesareinitiatives
todeepeneconomicandenergycooperation,includingestablishngablocwidedevelopment
bank.
WhatroledoestheSCOplayinAfghanistan?
TheSCOasagroupdoesnothavemuchswayinAfghanistan,thoughtheorganization
considersreligiousextremism,terrorism,anddrugtraffickinginthecountryaspotentialserious
threatstotheregion.ItsneighborssharethefearthatinstabilityinAfghanistanwillspreadbeyond
itsborders.ForKabultoparticipateinSCOcounterterrorisminitiatives,Afghanistanwas
elevatedfromanSCOcontactgrouptofullobserverstatusatthe2012SCOsummitinBeijing.
WiththepresenceoftheTalibanandlocalmilitantsalignedwiththeselfproclaimedIslamicState
andalQaedainAfghanistan,andthedrawdownofNATOforces,thelandlockedcountry's
securitysituationremainsatoppriorityatSCOmeetings.NewAfghanleadersPresidentAshraf
GhaniandChiefExecutiveAbdullahAbdullahhavebackedgreaterSCOparticipationin
rebuildingefforts,buttheorganizationhashadlittleinvolvementtodate.
However,someSCOmembernationshaveintensifiedbilateralengagementwiththecountry.
China,inparticular,hassoughttoplayalargerroleinstabilizingAfghanistantoprotectits
substantialinvestments.Currently,ChinaisthelargestSCOinvestorinAfghanistan,withprojects
includingthe$3billioncontracttodeveloptheAynakcoppermine(thoughitscompletionhas
facednumerousdelays).LeadersinBeijinghopethatastableAfghanistanwillhavea"spillover"
effectonChina'sownrestiveautonomousregionofXinjiang.Russia,too,participatesinavariety
ofbilateraleffortswithAfghanistan,includingtheprovisionofweaponstoitsarmy,
counternarcoticsinitiatives,anditsowninvestmentprojects.From1979to1989theSovietUnion
andAfghanistanwereatwar,buttoday,Russiahasavestedinterestinthecountry'ssecurity.

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MoscowviewstheSCO'sCentralAsianmembersasabufferzonebetweenRussiaand
Afghanistan,saysRaffaelloPantuccioftheLondonbasedRoyalUnitedServicesInstitute
(RUSI),andthereforechoosestostrengthenbroaderregionalsecuritytopreventinstabilityin
AfghanistanfromspreadingtoRussianborders.CentralAsianpartners,includingKazakhstan
andUzbekistan,havealsomadesignificantinvestmentsinAfghanistan.
Despitethesebilateralinitiatives,itisuncleariftheSCOwillplayalargerroleinAfghanistan.The
organization'snarrowactionisinpartduetotheobstructivismbymemberswhoprefertotackle
securityissuesatthebilaterallevel,andfrictionanddistrustbetweenmemberspreventtheSCO
fromformingaunifiedpolicyonsecurityissuesinAfghanistan.Expertscitetheabsenceofnot
onlypoliticalwill,butalsoalimitedeconomiccapacity(PDF)forthebloctotakeonamilitaryrole.
However,WeitzwritesthatifSCOmemberscouldmakeaneffectivecontributiontoAfghan
prosperityandsecurity,WesternpowersmaycometoappreciatetheEurasianbody.
DoestheSCOfostereconomiccooperationamongmemberstates?
Economiccooperationhasbecomeoneoftheorganizationsmorepressinggoalsinrecent
years.AttheUfasummitinRussia,memberstatesadoptedtheSCODevelopmentStrategy,
whichincludedbolsteringfinance,investment,andtradecooperationasapriorityoverthenext
tenyears.Beijinghaspushedtheorganizationtofocusoneconomiccooperationwithproposals
likelaunchingadevelopmentfundandafreetradezone.Inthepast,manyoftheseinitiatives
were"metwithskepticism"(PDF)byregional,accordingtoPantucci.However,CentralAsian
memberstates,inneedofinfrastructureandenergyinvestment,havebeenresponsivetothese
overtures,despiteRussiansensitivitiestoChina'sexpandinginfluenceinformerSoviet
satellites.
SeveralSCOmemberstatesnotablyKazakhstan,Russia,andTurkmenistanpossesssomeof
theworldslargestreservesofoilandnaturalgas,drivinginterestinexpandedenergy
cooperationamongmembers.AtaJune2006summit,RussianPresidentVladimirPutincalled
foran"energydialogue,integrationofournationalenergyconcepts,andthecreationofan
EnergyClub."Duringthatmeeting,memberstatesdiscussedestablishinga"unifiedenergy
market"foroilandgasexports,whilealsopromotingregionaldevelopmentthrough
preferentialenergyagreements.However,theplansnevermaterializedduetodiverginginterests
(PDF)betweenenergyconsumersandenergyproducers.Chinaislookingtotapenergy
resourcesforitsgrowingdemandandwhileKazkhakstanandRussiaaredominantenergy
exporters,Uzbekistanincreasinglyneedsitsenergyresourcesfordomesticdevelopmentand
consumption,andtheeconomiesinKyrgyzstanandTajikistanremainweak.Members"preferto
keepnationalcontrolovertheirproduction,supply,andconsumptionmechanismsand
agreements,"accordingtoJulieBoland,aformerFederalExecutiveFellowattheBrookings
Institution.

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Still,regionalenergycooperationoccursoutsideofSCOauspices.Russiahassecured
agreementswithseveralofitsCentralAsianneighborstobuildgaspipelines.China'senergy
diplomacysimilarlyfollowsabilateralcourse.Forexample,theCentralAsiaChinaGasPipeline
consistsofmultiplelines,bothcompletedandstillunderconstruction,runningmorethan1,100
milesthroughUzbekistanandKazakhstantoChina'sXinjiangUighurAutonomousRegion.
Beijingalsopledgeda$16.3billionfundtointegratetheregion,revivingoldtraderoutesaspart
ofChina'sSilkRoadEconomicBelt.ThoughChina'sflurryofactivityhasbeenuprootingRussia's
traditionallydominantinfluenceintheregion,energydealsbetweenBeijingandMoscowarealso
ontherise.
EnergycooperationisbutonefacetoftheeconomicexchangesamongSCOmembers.China
pitchedtheestablishmentofaninterSCODevelopmentBankin2010asasmaller,regional
versionoftheWorldBankandtheInternationalMonetaryFund.TheSCO'sconsensusbased
decisionmakingprocedureshaveenabledMoscowtoblocktheemergenceoftheSCO
DevelopmentBankforyears,fearingthattheinstitutionwouldcedefullcontroltoBeijingasits
dominantfinancier.Thoughthefinaldocumentfromthe2015Ufasummitdidnotaddressthe
statusofthebank,thereareindicationsthatRussiamaybemorewillingtocooperatewithChina
movingforward.RUSI'sSarahLainwritesthatwithinmultilateralbodies,"Russiaappearswilling
toacceptsomelossofstatusinfavourofChina"inordertogainfromclosertieswithChina.
HowhaveSinoRussianrelationsshapedtheSCO?
ChinaandRussiaarethetwinenginesoftheSCO,despiteofferingdifferingvisionsforthe
organization.DecadesofrapideconomicgrowthhavepropelledChinaontotheworld'sstage,
whereasRussiahasfounditselfbesetwitheconomicturmoilandgeopoliticalisolationfollowing
its2014annexationofCrimea,subsequentejectionfromtheG8,andcontinuinginvolvementin
theUkraineconflict.Inthepastyear,theRussianeconomyhasfalteredamidcurrencyandoil
pricevolatility,aswellasanonslaughtofsanctionsimposedbytheWest.
MoscowhadlongblockedBeijingseffortstoadvanceeconomicinitiativeswithintheSCO.
However,muchlikeitsCentralAsianneighbors,MoscowisnowlookingtobenefitfromChinese
investments,includingfromenergyandmanufacturingdeals.SincethefalloutbetweenRussia
andtheWest,Russiahasmadeitsown"pivot"totheEasttoimprovetieswithitsAsian
neighbors,openingthedoorforgreatercooperationbetweenBeijingandMoscowinshapingthe
SCOagenda.Oflate,China'sslowinggrowthhasinjectedadegreeofuncertaintyaboutthe
futuremomentumofitseconomy,butanalystssaythatduetoRussia'sowneconomyvolatility,
ChinawillremaincrucialpartnerforanincreasinglyisolatedRussia.
SomeexpertsbelievethatrecentmovesbyBeijingandMoscow,includingtheagreementto
harmonizeChina'sSilkRoadEconomicBeltandRussia'sEurasianEconomicUnionandbilateral
militaryexercisesintheMediterraneanSea,signalanententebetweenthetworegionalpowers.

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GregShtraks,afellowattheEastChinaNormalUniversityinShanghai,writesthatthe
improvementinSinoRussianrelationsseemstobea"genuine,lastingphenomenon."Pantucci
addsthatMoscow'soverturestoBeijingnotonlyindicateawillingness,butalsoaneagernessto
haveaclosebilateralrelationship,inbothappearanceandpractice.
However,otherslikeUniversityofTasmania'sMatthewSussexbelievethatRussia'srelationship
withChinahas"deepenedbynecessityratherthanasenseofmutualtrust.AnitaInderSinghof
theNewDelhibasedCentreforPeaceandConflictResolutiondoubtsthedurabilityofBeijing
andMoscow'scooperation,claimingthatthe"'hasbeensuperpower'andthe'wannabegreat
power'areengagedinacontestforprimacyinEurasia."
HowwillmembershipexpansionaffecttheSCO?
Enlargementbringsbothrisksandrewards.Todate,theSCOhasyettofinalizetheexpansionof
itsmembership,despiteapplicationsfromIndia,Iran,andPakistan.InSeptember2014,theSCO
clearedalllegalhurdlestoexpansionattheheadsofstatesummit,andIndiaandPakistanbegan
theaccessionprocessattheJuly2015summitinUfa.Belarus,aformerdialoguepartner,was
alsoupgradedtoobserverstate,andArmenia,Azerbaijan,Cambodia,andNepalwere
introducedasnewdialoguepartners.
BeijingmaintainsthatSCOexpansionwould"infusefreshvigorintothegroup'sfuture
developmentandboostitsinfluenceandappealintheinternationalarena."Moscowseesthe
additionofIndiaandPakistanasachancetoincreaseboththebloc'spoliticalandeconomic
potentialandboostitsabilitytocounterpressingregionalchallenges.Meanwhile,smallerSCO
members,concernedofbeingsqueezedbytheinterestsoftwosuperpowers,seetheinclusionof
IndiaandPakistanasanopportunitytodiversifyandbuildnewpartnerships.
Meanwhile,someareaexpertssaythatintroducingnewmembersincludingthosewithfraught
bilateralrelationslikeIndiaandPakistantoanorganizationthathasbeencriticizedfor
inefficacyisunlikelytoresultingreaterefficienciesorcohesion.BarnardCollege'sAlexander
CooleycautionsthatexpansionwillmaketheSCO,"asymbolicorganizationratherthanavehicle
foranykindofsubstantiveregionalintegrationorcooperativeproblemsolving."
Despitethepotentialdrawbacks,someexpertssaythattherearecollectivegainstobemadefor
thestillyounggrouping.AsthetwoSouthAsiannationsjoin,theprospectsforaSCO
DevelopmentBankmayimprove.NewDelhi,keentoinvestinCentralAsia,wouldbeasourceof
valuablefinancingandinjectlifeintoambitiousinfrastructureandenergydevelopmentplans.The
additionoftheworld'slargestdemocracy,India,couldalsograntgreaterlegitimacytothebody
traditionallyseenasaclubofauthoritariangovernments.CFR'sElizabethC.Economyand

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WilliamPiekoswritethat"whileexpansionmayhindertheorganizationsabilitytoactdecisively,it
willgivetheSCOtheopportunitytorevolutionizeitselfintoamorecomprehensiveinstitution
capableofconnectingandintegratingabroadswathofAsia."

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