Physical Address
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In an international landscape marked by volatility and fragmentation, every platform for dialogue retains significant value. Face-to-face encounters among leaders are invariably preferable to silence, as they preserve essential channels for crisis management. Yet, from an economist’s standpoint, the real substance lies not in the spectacle of summitry or the lofty rhetoric it produces, but in the concrete economic interests being advanced. In the case of the Shanghai Cooperation Organisation (SCO), this tension becomes particularly visible: while the political narrative highlights multilateralism, the economic reality is increasingly shaped by the priorities of a select few, foremost among them, China.
Multipolarity or one-sided trade
The SCO traces its origins to the “Shanghai Five” mechanism, established in 1996 by China, Russia, Kazakhstan, Kyrgyzstan and Tajikistan to ensure border security. With Uzbekistan’s accession in 2001, the organization assumed its current structure. Today, the SCO comprises 10 full members, two observers, and 14 dialogue partners, spanning Asia, Europe, and Africa. Collectively, it represents nearly 24% of the world’s landmass, 42% of the global population and roughly one-quarter of global gross domestic product (GDP).
Over time, the SCO’s agenda has expanded beyond its original security focus to include energy cooperation, infrastructure, digital economy and cultural exchange. Trade among members has grown nearly one hundredfold over the past two decades. In 2024, China’s trade with SCO members, observers and dialogue partners reached $890 billion, accounting for 14.4% of its total foreign trade.
This year’s summit brought together leaders from China, Russia, India, Pakistan, Central Asian republics, Iran and, as a dialogue partner, Türkiye. President Recep Tayyip Erdoğan’s participation once again underscored Ankara’s determination to strengthen its visibility within Eurasia’s multilateral platforms. The summit concluded with the adoption of the Tianjin Declaration, a ten-year strategy and outcome documents on security, trade, energy and cultural cooperation. Symbolically, leaders also issued statements marking the 80th anniversary of the end of World War II and the founding of the United Nations.
The previous leaders’ summit in July 2024 in Kazakhstan produced 25 strategic documents on energy, finance, cybersecurity and regional stability, underscoring the SCO’s continued value as a political showcase. Yet, questions persist over its ability to generate binding economic integration. Despite the rhetoric, the organization lacks a customs union, a binding trade regime, or an internal free trade area. In practice, tangible economic outcomes are often left to bilateral agreements among members or delegated to projects aligned with China’s Belt and Road Initiative.
Participants, their agendas
A key highlight of this year’s SCO summit was Indian Prime Minister Narendra Modi’s return after a seven-year absence. His meeting with Chinese President Xi Jinping marked a cautious step toward easing tensions since the 2020 border confrontations.
China, the organization’s economic powerhouse, used the summit to reinforce its vision of a multipolar world and promote Belt and Road Initiative projects. U.N. Secretary-General António Guterres recently emphasized that China’s support for multilateralism is vital to global stability. In this context, the SCO serves as both a platform for China to project its influence and a showcase of its multipolarity narrative, even as economic benefits remain asymmetrical.
For Russia, the summit provided an opportunity to strengthen ties amid Western sanctions, with President Vladimir Putin advocating the use of national currencies in trade and the establishment of new energy corridors. Security concerns in Afghanistan were also highlighted.
Iran asserted its priorities in energy and transport corridors, positioning itself as a more active regional actor, while Pakistan emphasized terrorism and regional security, implicitly referencing tensions with India. Central Asian members focused on economic integration and connectivity, with Kazakhstan stressing an independent, multi-directional foreign policy.
Armenia, represented by Prime Minister Nikol Pashinyan, participated at this level for the first time. Amid ongoing normalization with Azerbaijan and a relative decline in Russian influence, Yerevan’s presence signalled an effort to diversify diplomatic and economic partnerships in Asia.
Türkiye as Eurasia’s strategic bridge
As a dialogue partner, Türkiye played a visible and influential role at the summit. President Recep Tayyip Erdoğan used bilateral meetings and public statements to reinforce Ankara’s position as a mediator and constructive actor in international diplomacy. Türkiye highlighted critical global issues, including the humanitarian situation in Gaza, the Russia-Ukraine conflict and development support for Syria, demonstrating its capacity for diplomacy with global significance. During bilateral talks with China, Erdoğan also made a pointed call to SCO members: “Invest in Türkiye,” underlining the country’s commitment to expanding economic partnerships.
By combining active engagement in the SCO with its commitments as a NATO member and Western partner, Türkiye has demonstrated a dual strategic approach, reinforcing its role as a bridge between Europe and Asia. President Erdoğan emphasized the strengthening of the Middle Corridor, diversification of energy routes and Türkiye’s function as a key transit hub linking Europe and Central Asia, while leveraging bilateral channels and trade in national currencies to achieve tangible economic outcomes despite the SCO’s limited formal framework. His engagements and public statements underscored Türkiye’s determination to advance diplomacy, energy, trade and security objectives simultaneously, balancing Western alliances with proactive Eurasian partnerships.
Trade in shadow of power
The SCO’s economic agenda, often overshadowed by politics, highlighted deepening regional trade but persistent imbalances. Trade among members has grown roughly a hundredfold over the past two decades, yet China dominates exports, while Iran and Russia primarily supply energy and raw materials. Initiatives framed as “development aid and technical partnership” largely advance China’s strategic and economic interests, creating a pronounced asymmetry.
Indian Prime Minister Narendra Modi’s return and his bilateral talks with Xi Jinping underscored this imbalance: he focused on reducing India’s $99.2 billion trade deficit and easing border tensions, illustrating the challenges of achieving equitable economic outcomes within the SCO. Central Asian members pursued integration and connectivity. Kazakhstan emphasized an independent foreign policy, while Russia expanded its energy trade with China. Iran strengthened its energy and transport corridors, Pakistan advanced Belt and Road-linked infrastructure, and Armenia sought diversified partnerships.
In sum, while the SCO projects a multipolar diplomacy platform, trade remains China-centric, with other members primarily supplying resources that reinforce China’s dominant influence, highlighting the competitive and reality-driven conditions of (regional) markets where economic leverage often outweighs diplomatic signalling.
