22.06.2011
Should the Shanghai Cooperation Organization Be Enlarged?
№2 2011 April/June
Alexander V. Lukin

National Research Institute–Higher School of Economics, Moscow, Russia
Head of the International Affairs Department,
Head of International Laboratory on World Order Studies and New Regionalism

Аffiliation

SPIN RSCI: 6899-4298
ORCID: 0000-0002-1962-2892
ResearcherID: L-4986-2015
Scopus AuthorID: 7102949872

Contacts

E-mail: [email protected]
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Russia and Stability in Central Asia

Over the ten years of its existence the Shanghai Cooperation Organization (SCO) has become an active and much respected regional organization that has been drawing interest from many countries. Considerable progress has been made in coordinating efforts to ensure regional security. The SCO member states engage in military cooperation and hold multilateral counterterrorism exercises. Their intelligence services exchange sensitive information, have agreed on a common list of terrorist organizations, and are jointly combating drug trafficking. Who would have imagined 20 years ago such a level of confidence and cooperation between, for example, Moscow and Beijing? There are also certain, albeit not very impressive, achievements in the economy, culture and education.

However, time has set new tasks to the SCO. Actually, it is a matter of whether the SCO will evolve as a club of states not doing much between their meetings and loud statements, or whether it will become a serious international mechanism comparable in influence to ASEAN or APEC or, perhaps, even excelling them. Considering the unpredictable situation in Central Asia, which may see yet events similar to the “Arab Awakening,” the SCO, as the most influential organization in the region, may soon prove to be very essential.

WHO SHOULD BE ADMITTED TO THE SCO?

Until recently, all SCO member states and most experts held that the number of members should not be increased for the time being, as the organization must first strengthen in its present composition, set its mechanisms going and gain experience. That was why the SCO Council of Foreign Ministers (CFM) reached a tacit understanding in May 2006 on a moratorium on the admission of new members. The understanding was tacit because it was at variance with the SCO Charter, which proclaims the organization open for other states. The moratorium was further confirmed at meetings of the SCO Council of Heads of States (CHS) in June 2006 in Shanghai, in August 2007 in Bishkek, and in June 2010 in Tashkent.

Meanwhile, international interest in the SCO kept growing, primarily among observer states. Back in 2006, Pakistan requested full membership. Iran made similar requests in 2007 and 2008, and India expressed its wish to become full member in 2010. However, apparently in order to avoid a refusal, which would have been a major blow to the vanity of such a large country, New Delhi did not send an official request following procedures required by the organization’s documents, but sent official letters to the member states’ foreign ministers.

In 2009, the SCO summit in Yekaterinburg introduced “dialogue partner” status, which was granted to Sri Lanka and Belarus.

Egypt, Nepal, Serbia, Qatar, Azerbaijan, Turkey and some other countries have also displayed interest in establishing contacts with the SCO.

The SCO has until recently explained its reluctance to accept new members by technical reasons, namely, the absence of mechanisms for joining the organization. However, the CHS at a June 2010 meeting in Tashkent approved Regulations on the Admission of New Members to the SCO, which formulated clear criteria that new members must meet. Under the Regulations, a state wishing to become a full member of the SCO must be located in the Eurasian region, have diplomatic relations with all SCO member states, maintain active trade and economic ties with them, have the status of observer or dialogue partner, and not be under UN sanctions. The latter criterion makes Iran, one of the most active applicants, not eligible for full membership for an indefinite time. In the security field, international obligations of states wishing to join the SCO must not conflict with international treaties and other documents adopted by the SCO. In addition, an applicant state must not be involved in an armed conflict with another state(s).

The Regulations established detailed procedures for admission to the SCO. At first, the head of an applicant state must submit an official request for membership to the CHS Chairman. Then the CHS, following advice from the CFM, announces the beginning of the admission procedure. A Memorandum on Obligations of an Applicant State Required for Membership, to be drawn up later, will list international treaties that the applicant state must join and organizational and financial terms for membership. After the applicant state has fulfilled the obligations stipulated by the Memorandum, the CHS passes a decision to grant it the status of a SCO member state. However, if the applicant state has failed to fulfill the obligations, the CHS may suspend or terminate the admission procedure.

The next SCO summit, scheduled to be held in June 2011 in Astana, is to approve a model Memorandum, which will be the last step in creating the formal basis for admitting new members.

Several SCO states have recently revised their stance on the moratorium on the admission of new members. For example, Tajikistan supports the candidacy of Iran for cultural and historical reasons. That was why Dushanbe to the last moment objected to the provision in the Regulations requiring that an applicant state must not be under UN sanctions. However, in the long run Tajikistan had to yield to pressure from other members who feared that Iran’s admission could provoke a serious confrontation between the SCO and the West.

After Iran was made not eligible for admission, Russia became the main supporter of the SCO’s enlargement. At the SCO summit in Dushanbe in 2008, it initiated the establishment of a special expert group, which later drafted the admission documents. At the Astana summit, Russia is expected to call for the termination of the temporary moratorium on the admission of new members.

Russia’s position stems from its strong support for India’s candidacy, which was stated in the Joint Russian-Indian Declaration on Deepening the Strategic Partnership, signed by the two countries’ leaders during an official visit to Russia by Indian Prime Minister Manmohan Singh in December 2009. Admitting such a large and successfully developing country as India would make the SCO the second largest international organization in the world after the United Nations in terms of the aggregate population of its members. India’s admission would significantly increase the SCO’s political weight and economic attractiveness among developing countries.

One of the SCO’s priorities is stepping up cooperation in Central Asia. The SCO members share the following common objectives:

1) maintaining political stability in the region;

2) preserving secular regimes in power as an alternative to radical Islamism;

3) accelerating the economic development of Central Asian states as a basis for political stability.

Russia is actively cooperating with China within the SCO in meeting these goals. In doing so, Russia welcomes China’s stabilizing economic presence in Central Asia, while Beijing recognizes the traditional Russian interests in the region. Yet, some analysts in Russia fear a too rapid growth of China’s economic role in Central Asia. From this point of view, one could only welcome India’s admission to the SCO, as this country can make a significant contribution to the development of Central Asian countries and help diversify their external economic relations.

Indian interests in Central Asia fully coincide with the interests of the SCO member states, and India’s development goals meet the organization’s objectives. India is a secular state and is actively combating ethnic nationalism, separatism and religious extremism. It knows from its own experience what the threat of terrorism is. In the last few decades, India has been successfully developing its economy. Its unique economic model, which is oriented towards the domestic market and which has shown its advantages during the current global crisis, would supplement other development models of SCO members. In addition, relations with Russia, China and Central Asian countries have always been a top priority for India.

Admitting India would also help stabilize the situation in Central Asian countries and accelerate their economic development. India has a long history of mutual relations with the region. There were times when Central Asia, Afghanistan and northern India were parts of one state. Today, India continues actively developing trade and economic ties with Central Asia and making significant investments there. The strengthening of its economic positions in the region would not conflict with the interests of other SCO member states; moreover, it would serve the common goal of economic development of the region, while counterbalancing the growing economic influence of the West, especially the EU. One should also keep in mind the positive political influence of New Delhi, because India is the world’s largest democracy, which at the same time has preserved many of its values and specifics.

India could also make a great contribution to the SCO’s efforts to stabilize the situation in Afghanistan. India has already invested over one billion U.S. dollars in reconstruction projects in Afghanistan, and it could provide significant support to programs of the SCO and its members aimed at developing the Afghan economy. Geopolitically, India’s full-scale membership in the SCO could result in a shift of its interest in partnership from the West to Russia and Asian states.

The idea of admitting India to the SCO has been opposed by China. Beijing argues that admission of such a large country would change the face of the relatively young organization and that the already complicated decision-making process would become still more difficult. Indeed, the organization will have to introduce a third official language – English, expand its Secretariat and Regional Anti-Terrorist Structure (RATS), etc. Yet, bearing in mind the large financial potential of India and other factors, all these problems can be solved. India will likely have the same quota as Russia and China have in the SCO standing bodies and will make a commensurate contribution to the SCO budget. In any case, the above-mentioned benefits from India’s joining the SCO will outweigh by far organizational difficulties.

The real reason for China’s doubts is its difficult relations with India. Recently, however, there has been some progress in this respect, and the work of these two great Asian powers within one international organization will promote constructive dialogue between them.

Russia and China, viewed as the SCO leaders simply because of their size, will certainly have to share their influence in the organization. But they will have to make a strategic decision: What is more important – one’s influence in the SCO or the growth of the SCO’s influence in the world? If a country views its own influence as more important, why join international associations at all? Meanwhile, the growth of influence of the international organization in which a state is a member increases the international prestige of this state as well.

This is how the majority of major international institutions – NATO, the EU and ASEAN – reasoned when they were making decisions on their enlargement. The enlargement did bring them some problems: the growth of red tape, difficulties with reaching consensus in decision-making, reduced governability and efficiency, and changes in the balance of forces within the organizations, often not in favor of their founders. Nevertheless, all the three aforementioned associations were intent on enlargement as the positive effect outweighed the negative one.

From this point of view, one could welcome a decision to admit to the SCO Pakistan which filed a formal application earlier than India did. Of course, Pakistan’s economic role in the organization would not be as great as India’s, but Islamabad plays a key role in the Afghan settlement process and has great economic and political influence in the region. In addition, admitting Pakistan, which maintains close relations with China, would help obtain Beijing’s consent to India’s admission.

Of course, the import of Indo-Pakistani differences to the SCO would pose a challenge to the young organization. However, both India and Pakistan are members of the South Asian Association for Regional Cooperation (SAARC), which is not an obstacle to its work. As in the case with China, cooperation between India and Pakistan in one more international organization would help establish a constructive dialogue between New Delhi and Islamabad.

Beijing also wants Mongolia and Turkmenistan to be admitted to the SCO. The other SCO members do not object. Admitting Mongolia, which actively cooperates with the SCO in an observer capacity, would close the only territorial gap in the very heart of the SCO space. Turkmenistan, which, like Mongolia, possesses significant natural resources, could play an important role in energy cooperation. In addition, Ashgabat has stepped up its policy towards Afghanistan and recently proposed starting negotiations in the Turkmen capital within the framework of an intra-Afghan dialogue, similar to negotiations on settlement in Tajikistan. However, neither Mongolia, nor Turkmenistan display much interest in SCO membership, and they have never officially applied for it. One could only welcome Beijing’s efforts to stimulate Ulan Bator’s and Ashgabat’s interest in participation in the SCO.

The SCO has recently been actively involved in addressing problems related to Afghanistan. In this regard, the existing mechanism of the SCO-Afghanistan Contact Group is no longer sufficient, and the SCO should give Afghanistan at least observer status.

HOW TO MAKE THE SCO MORE EFFICIENT?

Opponents of the SCO’s enlargement argue that the more members in the organization, the more difficult it will be to run it and the less efficient its administrative machine will be. However, this is not always so. The SCO administrative machine has not been very efficient from the very beginning, and the organization’s enlargement can paradoxically provide an impetus to its reform. Admitting other countries would imply major changes in the SCO; in addition, new members will provide a fresh look at how the SCO standing bodies work.

What is the problem of these standing bodies, especially the Secretariat, located in Beijing? In fact, the Secretariat is not an independent body in this international organization with a policy of its own. It is a conglomerate of representatives of the member states, who are sent there or recalled by their foreign ministries at any time. Naturally, these representatives are more accountable not to the Secretary-General but to their national ministries. Any, even insignificant issue, like a trip to some event in another country or allocation of a small amount of money from the budget, must be agreed with the CFM. In these circumstances, the Secretariat has no corporate ethics, no face of its own or corporate interests. One can hardly expect from such a body strategic plans and proposals that would differ from those proposed by this or that country.

Meanwhile, the experience of a majority of efficient international organizations (the UN, the EU, ASEAN, etc.) shows that the personnel of their standing bodies must be international officials, that is, they must not depend on their governments. States pursue their policies – for example, in the UN – via national representatives, whereas UN officers – whether they are citizens of Russia, France, the United States or Cameroon – are subordinate to senior executives in the organization, rather than to the embassies of their countries. Only in such circumstances can they think of the interests of the organization as a whole and actively promote them.

A reform of the SCO Secretariat requires, first, giving this body the right to manage the SCO budget independently of the CFM and the foreign ministries of the member countries; and, second, organizing employment to all posts upon competitive examination and on a contractual basis. Importantly, the termination of these contracts before they expire must be allowed only by a decision of the Secretariat. Staff members should be allowed to take labor disputes to court in the Secretariat’s host country or to a specially established SCO body. At the same time, employment quotas for countries may be preserved.

Of course, in this case the governments will lose control over their citizens working in the Secretariat. But this factor will help improve the organization’s work. It is no secret that the Secretariat is sometimes viewed as a place where a member country can send not a good employee that deserves it but one that the national foreign ministry does not need much (for example, an employee pending retirement on a pension, or one that is not active enough, or for some other reason).

Another organizational issue pending solution is a reform of the consensus method of decision-making. A formal understanding of consensus allows Uzbekistan to actually block cooperation in the economic and cultural spheres. Tashkent categorically refuses to participate in educational programs (in particular, in the SCO University) and in the SCO Youth Council. Of course, the positions of all SCO members must be respected, whether they are caused by a desire to avoid alien influence on young people or by real concerns about the quality of education in other countries. For example, Uzbekistan explains its reluctance to agree to mutual recognition of diplomas of higher education by the fact that in some SCO countries such diplomas are sold in underground walkways.

However, the lack of interest in joint projects from one member must not be an obstacle to cooperation among the others. In this regard, one can learn from other international organizations. For example, the ASEAN Charter (Article 20) provides that “where consensus cannot be achieved, the ASEAN Summit may decide how a specific decision can be made.” In practice, there is a mechanism whereby states that are not interested in a particular project simply do not participate in it and do not prevent others from doing this. At the same time, the EU’s enlargement has resulted in a gradual departure from the principle of consensus.

Economic cooperation is the weakest field of the SCO’s activities; multilateral programs are virtually non-existent in it. SCO reports usually give figures pertaining to bilateral cooperation, which would have developed without the SCO anyway (although the SCO does have a stimulating effect). President Dmitry Medvedev spoke of the need to step up economic interaction at the organization’s summits in Yekaterinburg (2009) and Tashkent (2010).

The inclusion of such large economies as India and Pakistan in the SCO could stimulate economic cooperation among SCO members and give impetus to multilateral projects. Both countries have great potentials in economic, scientific, cultural and educational fields.

The main problem standing in the way of economic cooperation is the lack of a mechanism for funding multilateral projects. The SCO budget is very modest and is not intended for this purpose. SCO members have long been speaking of the need to establish an SCO Fund or Development Bank, but to no avail. China insists on establishing a bank where members’ votes would be allocated depending on the size of their contributions. Other members fear that China’s contribution would be the largest and that China would control the bank and use its resources to its own advantage.

Russia has proposed establishing a Development Fund (special account) as a mechanism for funding pre-project studies, above all in areas such as energy, transport and high technologies. It is proposed that the implementation of projects would be stated by the SCO Interbank Association. Several Russian ministries believe that, if a SCO Bank is established, China would dominate in it as it has more financial resources than the other members, and that Russia’s interests would be better served by actively using the Eurasian Development Bank, established within the EurAsEC framework, in which Russia’s share by far exceeds those of other members.

This position is shortsighted. A SCO Bank, with China as a member, would have much greater financial resources than the Eurasian Development Bank has (where only Russia and Kazakhstan are active participants). Some of the SCO Bank’s resources could be used to fund projects in Russia. In addition, Moscow would have the ability to influence China’s financial participation in SCO projects, whereas already today Beijing unilaterally allocates substantial funds for concessional loans to Central Asian SCO members (as of now, over 10 billion U.S. dollars) – but only in its own interests, without any participation by Moscow. It is the current situation, rather than the establishment of a bank, that leads to China’s economic domination in the region. As regards the SCO Interbank Association, there are doubts about its ability and desire to fund major multilateral projects. In addition, the proportion of financial powers in the Association does not differ from that of financial capabilities of the SCO member states.

It would be in Russia’s interests to agree to the establishment of an SCO Development Bank, providing at the same time that China and Russia contribute equal shares to its capital (as they do to the SCO budget) and that these two countries have an equal number of votes. Admitting India to the SCO would also be highly useful from this point of view, as it could contribute to the bank a share equal to those of China and Russia, thus ruling out a possibility of unilateral domination by any member.