The SCO and the Contours of an Alternative Global Cooperation Model

By Nargiza Muratalieva

Beginning as the "Shanghai Five" security process, the Shanghai Cooperation Organisation (SCO) has evolved into a fully-fledged international organization comprising 10 member states, 2 observers, and 15 dialogue partners. While prior to its expansion the SCO was often dismissed as a “discussion club”, today its geographical reach, agenda, and institutional framework make it impossible to ignore. The modern SCO stretches from Eastern Europe to South Asia, uniting 10 member states that account for roughly 40 percent of the planet's population and approximately a quarter of the global economy.

To put the scale into perspective: under the SCO Plus format, Bishkek managed to bring together 18 states and 7 international organizations at a single table. Twenty-eight documents were signed and adopted – 24 at the level of heads of state and 4 at the level of governments and agencies. Around 200 events took place over the course of the Kyrgyz presidency, with more than 50 hosted inside Kyrgyzstan itself. International interest in the SCO continues to grow; for instance, a decision was made to sign a memorandum of understanding between the organization's Secretariat and the African Union Commission.

The organization's influence extends far beyond its member states, making it crucial to examine what is being discussed at the SCO table, what has already been decided, and, consequently, what contours of the future are beginning to take shape across Eurasia.

From Amorphousness to Institutional Reforms

For years, the SCO has been criticized for its heterogeneous membership and internal contradictions. Because the organization continues to operate on the principle of “consensus where it exists”, decision-making can drag on for years. In particular, despite the success of the Shanghai Five in resolving border issues, the list of multilateral economic projects remains quite modest. For instance, launching the construction of the China–Kyrgyzstan– Uzbekistan railway can be attributed just as much to the Belt and Road umbrella initiative as to the SCO. This applies equally to responding to conflicts across various flashpoints in Eurasia, when taking measures in situations requiring speed and agility, as was most recently the case at the 2025 defense ministers' meeting in Qingdao, it remains unable to act.

At the same time, however, it would be mistaken to underestimate the SCO's capacity to change and adapt to shifting geopolitical conditions. Although the expansion of the organization and its partnerships did not yield immediate benefits, over a quarter of a century the SCO has proven its resilience and ability to undergo institutional reforms. First, for the first time since 2002, a protocol on amendments to the Charter was signed, granting all external observers and dialogue partners a unified status as “partners”. While this is a largely formal change in nomenclature, other new institutions have also emerged. In particular, the security institutional block has been strengthened: regulations have been approved for the universal center to counter challenges and threats under RATS and for the executive committee of the Anti-Narcotics Center in Dushanbe. Furthermore, for the first time in its history, a permanent SCO institution – the Center for Combating Transnational Organized Crime will be hosted in Bishkek. This is an initiative of Kyrgyz President Sadyr Japarov that has successfully materialized. In addition, Kyrgyzstan has also invited countries and business organizations to the “Tamchy” special financial and investment zone, opened in July on Issyk-Kul, and highlighted the China–Kyrgyzstan–Uzbekistan railway as a key practical project.

From Declarations to a Path of Normative Power?

If declarations are eventually forgotten, buildings, institutional staff, and budgets outlive summits. Yet in an era of discourse and norms competition, declarations and initiatives can be converted into normative power and influence. Artificial intelligence issues received special attention at the summit.

China proposes an international cooperation center on AI applications; Kazakhstan, a network of AI centers under the organization's auspices; Uzbekistan, an open multilingual data corpus and a forum in Tashkent; and Pakistan, “sovereign AI infrastructure” and its own governance framework. While other countries debate the implementation of the AI Act, negotiations on the contours of an alternative set of standards are underway across the space from Minsk to Islamabad.

As a result, the organization adopted the Memorandum of Understanding on Cooperation in the Field of AI and the Concept for Creating Regional Data Centers and Computing Facilities. At the same time, the memorandum remains framework-based, as it creates neither a common data market nor a unified regulatory system, but merely paves the way for joint projects. Sadyr Japarov formulated the task more broadly – to " ensure equal access to modern technologies for all states so that the digital inequality does not become a new dividing line."

It is still too early to speak of the SCO's normative power, but given that member states are increasingly active in coordinating information policy, developing strategic documents and programs, and cooperating on AI issues, it can be assumed that this direction will gain momentum.

The SCO remains a salient coordinating platform in areas such as security, global governance, the development of transport and logistics projects, glaciers and transboundary water, emergency and humanitarian aid, cultural cooperation, and others. Among the important documents adopted, it is worth emphasizing the SCO Program on Synthetic Drugs and Precursors until 2030, the Cooperation Plan on International Information Security for 2026–2028, and the Ports and Logistics Centers Development Plan of the Organization’s Member States for 2026–2030.

Despite the SCO's insufficient weight in implementing economic projects, the organization provides a platform for discussing the transition to trade in national currencies. This topic became one of the key ones at the summit. According to data announced at the meeting, Russia's total trade turnover with SCO partner states exceeded 400 billion dollars, while the share of settlements in local currencies in these operations has already exceeded 98%.

Such dynamics demonstrate the SCO member states' desire to move away from dollar-centric financial models. In the future, this trend could lay the foundations for building financial infrastructure that reduces the cost of future sanctions. At the same time, one should not write off a number of systemic limitations over which work is proceeding very slowly. These include the limited convertibility and volatility of certain countries' currencies, the asymmetry of trade flows creating an excess of illiquid balances, and the lack of development in direct interbank infrastructure, among others.

For example, the SCO Development Bank has been discussed within the organization for more than ten years, and in Bishkek it was supported by almost everyone. The attention of many countries was riveted on this issue, yet the constituent documents on the Bank could not be signed just yet.

What's next? Pakistan has headed the organization for the first time since joining in 2017. The SCO has traveled a quarter-century path with rather impressive scales of expansion. However, in turbulent times, mere scale, statistics, and declarations of peace and multipolarity are no longer enough. How the organization's effectiveness will be evaluated, through the strength of declarations or rather the impact of projects – will be clear in the forthcoming future.

It is obvious that for influence and qualitative development of the SCO space, the organization needs the capacity to respond to, resolve, and settle conflicts, create working transboundary mechanisms, and implement multilateral projects that exclude any distortions in favor of individual players.

The views expressed in this article are not necessarily those of FES.