20 september 2018

Central Asia news

SCO member-states to set up the Development Bank and Energy club. China offers soft loans

09.11.2011 09:27 msk


Kazakhstan’s prime-minister Karim Masimov at the meeting of prime-ministers from the SCO member-states on Novermber 7th, 2011, proposed to set up a joint reserve bank.

In his turn, Omurbek Babanov, the first deputy prime-minister from Kyrgyzstan, has suggested that the proposed SCO Development bank could be helpful for implementation of major regional scale infrastructure projects, such as high-voltage power lines or the China-Kyrgyzstan-Uzbekistan rail road construction. Whereas the Tajikistan’s prime-minister Akil Akilov believes that such a bank should provide support and incentives for weaker regional economies.

Wen Jiabao, the chairman of Chinese State Council, has urged to provide for free transit of goods, capital and services through the SCO territories, along with faster development of the regional infrastructure networks for transportation, energy and communication. In turn, China has committed itself to offer soft loans in support of infrastructure projects in the SCO states.

He has also urged to consider the agricultural development by proposing to create the SCO bank of seeds. In addition, he reminded of cooperation with the observer states and urged to use national currencies for mutual trades.

Russia supports the establishment of the SCO special account, reminded Vladimir Putin. Without further ado he then suggested to revitalize the high voltage power line project to Pakistan. Reminding that the project, costing around 1,5-2 US$ billion, has been approved by the World Bank, Putin promised to contribute at last half billion from Russia for the sake of the soonest project’s implementation. Obviously, Pakistan and Afghanistan have liked the idea while their representatives have used the opportunity to remind of their applications for the SCO membership.

The organization is open for interactions and cooperation - confirmed Vladimir Putin, explaining that Russia would welcome the involvement of other states, for “the organization’s capacities, reputation and influence should benefit from this.” Putin has also drawn the attention to the Russian-Chinese initiative of the personal satellite communication system expansion across the SCO region.

According to ITAR-TASS, Russia is supportive of the idea of the energy club creation under the SCO. Vladimir Putin has claimed that the decision has been made in principle. The club will be joined by representatives from energy ministries from the SCO member states as well as the leading regional energy companies. Currently, there is certain rivalry underway between Russia and Kazakhstan, along with certain other countries of the Central Asia, over supplies of energy and fuels to China, whereas the proposed club could be helpful for settlement of disputes, said Nezavisimaya gazeta.

Russian prime-minister has also mentioned some political issues in his speech. Commenting on the statement by Babanov, Vladimir Putin dwelled a bit on the “Arabian spring” events: “We all know it has started from Kyrgyzstan. Yet however, the process is back on track again. Kyrgyzstan is moving forward, towards the stability.”

He has also found certain states’ moves at the international arena strange. “Indeed, those world powers used to support the former regimes too, just as they did support the revolutions in the northern Africa against such regimes. That’s the world today, quite interesting” – he commented on the statement by a representative from Iran.

Other things discussed at the meeting of prime-ministers included countering terrorism and drug traffic. When responding to a question at a press-conference, Vladimir Putin has emphasized that NATO and United States spend huge amounts of money for development of infrastructure in Afghanistan. “I am not sure how this is compatible with their plans of withdrawal from Afghanistan, though perhaps this is going to happen, anyway” – said the Russian prime-minister, adding that Afghanistan needs support in rebuilding its economy.

As the outcome of the meeting the leaders of the SCO member-states’ governments have signed a number of documents, including the organization’s budget for 2012, list of activities aimed at the continued development of the SCO projects, joint communiqué as well as the joint statement of the economic situation in the world and within the SCO.

Next meeting of prime-ministers from the SCO member-states is going to take place in Kyrgyzstan in 2012.

SCO dates back to 2001, initially consisting of China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. The organization’s original goal has been defined as countering extremism and strengthening the border safety. Later, the organization has been joined by India, Pakistan, Iran and Mongolia as observers.

Fergana International Information Agency