Foreign Policy and Civil Society Program

July 2012

Summary: Although the 12th Heads of State Summit of the Shanghai Cooperation Organization seems to have produced some more tangible results than those of the previous five years, the fact remains that the organization is a paper tiger in terms of security issues. Its prospects for creating a common economic space have been severely constrained. Its two largest members, Russia and China, are pursuing increasingly divergent policies. As seen from Central Asia, the future of the SCO, and especially its ability to efficiently address important, long-term challenges in the region, is more than ever in doubt.

Central Asias Long-Term Questions Remain Unanswered After the Shanghai Cooperation Organization Summit
by Sbastien Peyrouse
The 12th Heads of State Summit of the Shanghai Cooperation Organization (SCO) was held in Beijing on June 6-7, 2012. Although the organization, an intergovernmental mutualsecurity organization founded in 2001 in Shanghai by the leaders of China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan, appeared to be in a sort of growth crisis since 2007-08, the summit confirmed some new breakthroughs, at least on the surface. Regarding the definition of the organizations goals, for the first time member states approved a strategic plan for medium-term development over the next decade. On the issue of enlargement, Afghanistan finally became an observer member, while Turkey was offered the status of dialogue partner, the first for a NATO member state. In terms of economic issues, Chinese President Hu Jintao relaunched his 2009 proposal to provide a US$10 billion loan under SCO auspices, and has tried to foster Chinas newly acquired soft power by offering thousands of scholarships for Central Asian civil servants. Although this summit seems to have produced some more tangible results than those of the previous five years, the fact remains that the organization is a paper tiger in terms of security issues and has seen its prospects for creating a common economic space severely constrained. Its two largest members, Russia and China, are pursuing increasingly divergent policies. As seen from Central Asia, the future of the SCO, and especially its ability to efficiently address important, long-term challenges in the region, is more than ever in doubt. The SCO strategic plan for mediumterm development, triumphantly announced at the end of the summit, does not address any of the regions real problems. The organization continues to be fixed on two agendas security and economics. These agendas do not necessarily contradict one another, but they emphasize different priorities according to different member states. Tajikistan, Kyrgyzstan, and Uzbekistan complain that the SCO is moving away from the purely security objectives that had been emphasized during its creation. Meanwhile Kazakhstan and Russia are primarily interested in the economic potential of the organization and have cast aside its security role. In addition, and as before, no thorny issues were discussed. The Chinese organizers were careful not to open for deliberation any of the real problems

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that hamper regional cooperation, such as the water/energy conflict between Uzbekistan on one side, and Kyrgyzstan and Tajikistan on the other. Issues of governance, inefficiency of law enforcement agencies, or the dynamics of failing states, on the model of Kyrgyzstan in 2010, were consciously avoided. Risks of any kind of popular uprising or social discontent like the Zhanaozen riots of December 2011 were mentioned only in order to denounce the destabilizing, external influences that were allegedly behind them or the perceived Islamic threat. Also worrisome for the Central Asian states is the growing divergence of Russian and Chinese strategies for the region. The new Russian activism in economic and strategic matters runs directly counter to Chinese goals, even though Moscow never makes this contrast. Strengthening the competences of the Collective Security Treaty Organization (CSTO) in preparation for the 2014 withdrawal from Afghanistan and changes in the regional balance of course excludes China and seeks to marginalize the SCOs security initiatives. In any case, the only security-related area in which the SCO has been able to demonstrate efficiency was in establishing a blacklist of Uyghur dissidents and so-called Islamist groups, and exchanging information about them between the security services. Although SCO rhetoric has an extreme emphasis on security issues, the organization has no real presence on the ground. It lacks common anti-drug brigades and joint border controls, almost never engages in common military exercises (except for SCOCSTO parades that primarily and superficially involve the member states headquarters), and has no collective preparedness measures for natural or industrial disasters or uncontrolled migration flows. On economic issues, Moscow also wants to weaken the SCO, not to mention Chinas status as the first trading partner of the Central Asian countries. The Customs Union put in place in 2011 and integration projects toward a Eurasian Economic Space, which entails the first supranational institutions in the area since the collapse of the Soviet Union, can be interpreted as a Russian response to Chinas economic dominance in the region. In reality, these integration projects are as much political pursuits as they are economic ones. They aim to reaffirm Moscows influence over its near abroad, both for those states that have accepted this partnership (Kazakhstan and Belarus) and those that have no choice (Kyrgyzstan and Tajikistan, and

possibly Armenia). In practice, these integration projects do not actually impede the entry of China into the local economies, which has brought with it massive trade and huge inward investment. However, they tend to shy away from greater economic disassociation between Central Asia mainly Kazakhstan and Russia, and promote integration through hydrocarbon exports, electricity production, and Eurasian transport systems. For the Central Asian states, this growing estrangement between Moscow and Beijing could be both a blessing and a curse. A blessing because it weakens the grip of a Russian-Chinese alliance in the region and allows the local regimes to play the two powers off of one another; a curse because the situation creates the risk of increased tensions between two important external actors. It could force local governments to favor one power over the other, which goes against the Central Asian multi-vectored policies for maintaing geo-strategic balance. In any case, this situation does not fool anyone. Li Lifan, the secretary general of the Center for SCO Studies at the Shanghai Academy of Social Sciences, makes this very clear when he states that in Chinas view, Russia is increasingly a questioning partner.1 For Moscows part, President Vladimir Putin has indicated the directions he will take during his current term in office: post-Soviet reintegration and the strengthening of Russias great power status via the UN Security Council (as can be seen with the Syrian crisis), the G20 more than the G8, and relations with important European countries like Germany and France. In this sense, although the bilateral partnership with China is always positively emphasized, the role of the SCO as a multilateral actor for the Central Asia region is noticeably marginalized. For the Kremlin, the last SCO summit was nothing but a platform from which to criticize so-called externally-imposed regime changes in the Middle East. The Central Asian governments certainly welcome the opportunities for trade and investment that China offers, especially during a time of global economic turmoil and the debt crisis in Europe. Uzbek President Islam Karimov visited Beijing not only for the SCO summit, but also to sign a joint declaration on the strategic partnership between the two countries and about 40 economic documents worth an estimated $4 billion. However, in its bilateral actions, China
1 Li Lifan and Raffaello Pantucci, Clashing interests in Central Asia strain Sino-Russian co-operation, South China Morning Post, June 6, 2012.

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is increasingly dissociated from the SCO as a multilateral platform. The two are seen in growing contrast: China acts, especially in the economic sector, while the SCO merely talks. Moreover, the multilateral character of the SCO is only a faade. Dozens of committees and working groups on a wide array of subjects have been created in recent years in order to familiarize participants from different member states and in part to break through the cultural barriers that formed long ago between the Russian-Soviet world and the Chinese one. However, major decisions are always made on bilateral bases. Beijing even negotiated the famous SinoCentral Asia pipeline separately with Ashgabat, Tashkent, and Astana despite a lack of collegiality between these three. As seen from Central Asia, the future of the SCO is far from being determined. The organization is welcomed as the main non-CIS platform for regional discussion. It allows for interaction with the Chinese world and for the building of new bridges with observer states, i.e. India, Pakistan, Iran, Mongolia, and now Afghanistan. On economic issues, the SCO is not certain to succeed in becoming a real multilateral mechanism to govern trade and investment dynamics, which are ultimately bilateral. Although Russialed reintegration projects fall far short of enjoying unanimous support even in states like Kazakhstan that are considered pro-Moscow nearly all Central Asian elites fear excessive Chinese dominance over local economies and thus feel obliged to support, albeit reluctantly, Russian initiatives. However, the biggest concerns for Central Asia are obviously strategic. Like other external actors, China does not have any solutions to offer local governments in cases of internal crisis, as demonstrated by the SCOs silence during the events in Osh, Kyrgyzstan, in June 2010. It will not take the side of one country over another in the case of regional conflicts over water, and will likely wait on the sidelines in the event of a political succession crisis. On issues of regional security, Central Asias fears of an excessive Chinese military or security services presence on their territory and Russias categorical refusal to move in this direction will continue to hinder any efficiency of the SCO in addressing actual security challenges. The longawaited inclusion of Afghanistan into the organization as an observer does not respond to the worries the Central Asian states have about the post-2014 situation. All local

decision-making circles have taken note of the wait-and-see approach of the Chinese leadership on the complex question of assisting Afghanistan and its central government after the coalition withdrawl. They also understand that above all else, Beijing will act to secure its own assets in the country, regardless of the direction it takes. Although China and its flagship organization are durable and well established on the Central Asian agenda, the thought of a SCO able to respond to the regions long-term challenges has dropped off the radar of the Central Asians.

About the Author

Sbastien Peyrouse is a Senior Research Fellow with the Central AsiaCaucasus Institute & Silk Road Studies Program at Johns Hopkins Universitys School of Advanced International Studies, Washington, DC, a Europe-Central Asia Monitoring researcher, and FRIDE associate.

About GMF
The German Marshall Fund of the United States (GMF) is a nonpartisan American public policy and grantmaking institution dedicated to promoting better understanding and cooperation between North America and Europe on transatlantic and global issues. GMF does this by supporting individuals and institutions working in the transatlantic sphere, by convening leaders and members of the policy and business communities, by contributing research and analysis on transatlantic topics, and by providing exchange opportunities to foster renewed commitment to the transatlantic relationship. In addition, GMF supports a number of initiatives to strengthen democracies. Founded in 1972 through a gift from Germany as a permanent memorial to Marshall Plan assistance, GMF maintains a strong presence on both sides of the Atlantic. In addition to its headquarters in Washington, DC, GMF has seven offices in Europe: Berlin, Paris, Brussels, Belgrade, Ankara, Bucharest, and Warsaw. GMF also has smaller representations in Bratislava, Turin, and Stockholm.

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