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Economic Cooperation Organization (ECO)-

An analysis

The Economic Cooperation Organization (ECO) is an intergovernmental regional

organization established in 1985 by Pakistan, Iran and Turkey with an objective of attaining
sustainable socio-economic development for their people. It is the successor organization of
Regional Cooperation for Development (RCD) which remained in existence from 1964 to 1979.
It also acts as a platform to discuss and identify ways and means to promote trade, and create
investment opportunities in the region hoping to establish a single market for goods and services,
much like the European Union. It’s headquarter is in Tehran, Economic bureau in Turkey, and
Scientific bureau is in Pakistan. It expanded its membership to ten in 1992 by adding seven new
members, namely Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan
and Uzbekistan. The official language is English. Total area is 7937197km2 with a population of
above 440 million. Total GDP is around $3trillion.

The ECO occupies a significant geo-strategic position on the globe as it is bordered by

Russia, China, the Indian Ocean, the Persian Gulf and the Caspian basin. Above all it contains
the largest reserves of oil, natural gas. Iran, Azerbaijan, Turkmenistan and Kazakhstan are
leading countries in oil and gas reserves.

Since its enlargement in 1992, the ECO’s main areas of cooperation remained trade and
investment, transport (including the building of road rail links, telecommunications and port),
energy (including the inter-connection of power grids in the region), mineral, environmental
issues, industry and agriculture sectors.

The other prominent feature is that they are all Islamic countries and geographically
contiguous with the same historical background.
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All the ECO states are also member-states of the Organization of the Islamic Cooperation
(OIC), while ECO itself has observer status in the OIC since 1995.

Infant Mortality
Infant mortality rate is an indicator of socio-economic progress level of any country. As
regards the same in ECO member states Afghanistan and Pakistan are at the top of the list with
70 per thousand live births in Afghanistan and 69 in Pakistan. Iran is lowest with 14 per thousand
live births in the region. In 2013, Afghanistan and Pakistan were identified as the 19th and 20th
countries of the world with the highest infant mortality rate. (Source-ECO Statistical report
2015)

Objectives:
 Sustainable economic development of Member States;
 Progressive removal of trade barriers and promotion of intra- regional trade; Greater role
of ECO region in the growth of world trade; Gradual integration of the economies of the
Member States with the world economy;
 Development of transport & communications infrastructure linking the Member States
with each other and with the outside world;
 Economic liberalization and privatization;
 Mobilization and utilization of ECO region's material resources;
 Effective utilization of the agricultural and industrial potentials of ECO region;
 Regional cooperation for drug abuse control, ecological and environmental protection
and strengthening of historical and cultural ties among the peoples of the ECO region;
and
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 Mutually beneficial cooperation with regional and international organizations.

Principles of cooperation:
 Sovereign equality of the Member States and mutual advantage;
 Linking of national economic, development plans with ECO's immediate and long-term
objectives to the extent possible;
 Joint efforts to gain freer access to markets outside the ECO region for the raw materials
and finished products of the Member States;
 Effective utilization of ECO institutions, agreements and cooperative arrangements with
other regional and international organizations including multilateral financial institutions;
 Common endeavors to develop a harmonized approach for participation in regional and
global arrangements;
 Realization of economic cooperation strategy; and Exchanges in educational, scientific,
technical and cultural fields

Organizational structure:
 The Council of Ministers (COM) is the highest policy and decision-making body and is
composed of Ministers of Foreign Affairs. The council of Ministers meets at least once a
year by rotation among the Member States.
 The Council of Permanent Representatives (CPR) is consisting of the Permanent
Representatives/Ambassadors of the Member States.
 The Regional Planning Council (RPC) is composed of the Head of the Planning
Organization of the Member States.
 The General Secretariat consists of six Directorates under the supervision of the Secretary
General and his Deputies. Two Specialized Agencies and six Regional Institutes are
acting under the supervision of the General Secretariat.
o Directorate of Industry & Agriculture
o Directorate of Trade & Investment
o Directorate of Energy, Minerals & Environment
o Directorate of Transport and Communications
o Directorate of Economic Research & Statistics
o Directorate of Project Researches

Regional institutions & specialized agencies:

 ECO Shipping Company
 ECO Chamber of Commerce and Industry
 ECO Reinsurance Company
 ECO Trade & Development Bank
 ECO Consultancy & Engineering Company
 ECO Supreme Audit Institutions
 ECO Cultural Institute
 ECO Science Foundation
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 ECO Educational Institute

 ECO Drug Control Coordination Unit
 ECO Trade promotion Unit
 ECO Post

ECO Trade and Development Bank:

This Bank was established by Iran, Pakistan and Turkey in 2005 with an objective to
initiate promote and provide financial facilities to expand intra-regional trade and to promote the
economic development of ECO member countries. Its subscribed capital is 300 million SDR, to
be paid by the member countries equally. The headquarters of the Bank is in Istanbul, Turkey.

ECO Cultural Institute (ECI):

ECO Cultural Institute (ECI) has been established in 1995 to foster understanding and to
preserve the cultural heritage of its members in the field of literature, art, philosophy, sport and
education.

ECO Trade Agreement (ECOTA) was established July 2003 in Islamabad. ECO Trade
Promotion Organization (TPO) is a new organization for trade promotion among member states
located in Iran (2009). Under the agreement reached between ECO members, the common trade
market is to be established by 2015.

Activities:
ECO activities are conducted through its various Directorates under the supervision of
Secretary General regarding projects and programs of mutual benefit in the fields of:

 Trade and Investment

 Transport and Telecommunications
 Energy, Minerals and Environment
 Agriculture, Industry and Tourism
 Human Resources & Sustainable Development
 Project & Economic Research and Statistics

Activities during 2013:

 A workshop on “Oil and Gas drilling” was held in Baku, Azerbaijan

 Workshop on “Interview and Interrogation Techniques” was held in Ankara, Turkey.
 “Experts meeting on Climate change and Biodiversity” was held in Islamabad, Pakistan.
 2nd meeting of ECO experts group on “Renewable Energy Sources” (RES) and 4th
workshop on RES was held in Baku, Azerbaijan.
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ECO operates a Special Fund for the Reconstruction of Afghanistan, which was established in
April 2004; by 2013 more than US $11m had been pledged to the Fund. ECO also envisages to
connect Afghanistan to the regional rail road system.

Pakistan hosted the 13th ECO Summit in Islamabad in 2017:

• The summit highlighted the state of affairs of ECO in the light of the new and emerging
global and regional circumstances and agreed on expanding regional economic
cooperation among its member states.
• The new ECO Vision 2025 was expanded upon and several key guidelines were taken
into account.
• Pakistan plans to integrate the ECO Summit members with the China–Pakistan Economic
Corridor.

Conclusion:
Regionalism has become a significant phenomenon in the study of political economy.
Globalization and liberalization has further emphasized upon establishing strong regional
linkages. The establishment of ECO is a significant development in regional cooperation and a
recent phenomenon in comparison to many other regions of the world.

No doubt ECO has the potential to grow but it is still facing lot of challenges but the
degree of integration depends upon the willingness and commitment of independent sovereign
states. Despite the fact, that the region is rich in energy resources, member states are financially
constrained to start their development projects.

Its infrastructure and institutions are yet to be developed to enable them to make use of the
available resources of the region. Above all it has yet to move forward in view of some internal
issues and difficulties confronted by some of its members. For instance Afghanistan is facing a
political imbroglio since long. Iran till now has remained extremely uncomfortable with
American bloc on nuclear issue and resultantly economic sanctions were imposed on Iran which
had its negative effect on its relations with its neighbors including Pakistan, Afghanistan and
Turkey which is now hoped to be eased after the nuclear deal with USA and lifting of sanctions
against Iran accordingly. Likewise trade relations between Pakistan and Central Asian states
could not flourish due to unsatisfactory situation in Afghanistan.

Moreover Russia is contiguous to all the Central Asian states and it has a well-developed
communication system linking with all these states along with a linguistic and political linkage
and influence and is not happy if these nations establish trade links outside the erstwhile Soviet
Union ambit of which these states remained a part for a long time. However with the onset of
socio-political stability in these Islamic countries it is hoped this organization will come up and
start delivering.

Recommendations:
The following recommendations could go a long way in achieving its objectives.
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1. There is a need to develop transport sector. With this development the

transportation costs in the region will be reduced significantly.
2. The training and skill development of the Human resource must be accelerated to
reap the full potential of the region.
3. ECO members should keep the political and regional differences aside as is being
done by ASEAN.
4. ECO should strengthen their relations with the other regional blocs such as
European Union, ASEAN and SCO to gain from their experiences.
5. Unless mutual differences and socio-economic barriers to move forward are not
properly addressed as discussed ECO would not be in a position to contribute in
boosting trade and development among member countries.

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