Draft:SCO Development Bank

Not to be confused with SCO Interbank Consortium.
Shanghai Cooperation Organisation Development Bank
Chinese: 上合组织开发银行
Russian: ШОС Банк развития
AbbreviationSCO Development Bank
TypeInternational financial institution
Purpose
Members
10 member states
17 SCO partners
Budget¥12 billion RMB (1.74×109 USD) (as of September 2025)[1]

The Shanghai Cooperation Organisation Development Bank (SCO Development Bank; Chinese: 上合组织开发银行; pinyin: Shàng hé zǔ zhī kāi fā yín xíng) is planned to be an international financial institution (IFI) of the Shanghai Cooperation Organisation (SCO), a Eurasian political, economic, and international security assembly.[2] The SCO consists of 10 member states and 17 partners.

It is believed that the SCO Development Bank will boost local currencies of participant states. Despite needing to deal with inflation,[3] the Bank intends to reduce dependency on the international use of the U.S. dollar,[4][5][6] by creating an alternative payment system.[1][7] Chinese president Xi Jinping announced that its founding would follow shortly after the 2025 Tianjin SCO summit.[1] At the summit, the Bank was described to, in the future, "provide stronger underpinnings for security and economic cooperation among member states" for "peace, stability, development, and prosperity in the region."[8][9]

History

The SCO Development Bank has and continues to be a plan, primarily sponsored by China.[10] Discussions for its development began in 2010, announced by premier of China, Wen Jiabao, but was blocked by Russia.[11][12] Preoccupied by international organization ventures in the 2010s, China did not resurface discussions until 2019, when it brought it back on meeting agendas.[13] The bank became increasingly prevalent in following discussions until it was finally announced to be founded at the 2025 Tianjin SCO summit.[1]

Initial proposals

The SCO Development Bank was first proposed in 2010 by Chinese premier, Wen Jiabao, at the SCO's ninth Prime Minister's meeting in Dushanbe.[14] China's dedication to the project idea was confirmed in its follow-up request at the 2011 tenth Prime Minister's meeting in St. Petersburg.[15]: 105 

Many consider security as the predominant purpose of the SCO.[16][17] In lieu of their economic and political interests, China and Russia have historically had mostly complementary interests within the SCO.[10]: 15 [12] However, China's interests in energy and trade presented competition.[10]: 16, 18  Russia was initially alarmed by the plans for the Development Bank, fearing it might threaten their economic dominance and propel Chinese economic potential and, thus, blocked both initiatives.[11][12][18]

2010 Dushanbe ninth SCO Prime Minister's meeting

During the Ninth Prime Ministers' Meeting of the SCO, held on 25 November 2010 in Dushanbe, Tajikistan, the former premier of China, Wen Jiabao, proposed to establish a development bank.[14][18] Its purpose was to institutionalize economic cooperation between the six member states at that time.[19]: 450  Held in 2010, the meeting followed the 2007-2009 Great Recession, exacerbated by the 2008 financial crisis, prompting many SCO member countries to support the effort, eager for funds. Wen also called for the creation of an SCO free trade zone.[11]

2011 St. Petersburg tenth SCO Prime Minister's meeting

The Prime Ministers of SCO member states again met on 7 November 2011 in St. Petersburg. During the meeting, Jiabao again resurfaced the possibility of establishing the Development Bank.[15]: 105  In their joint press release, member states supported it and reiterated its timely establishment, with plans to have it running prior to the SCO's next meeting, planned for the following year in China.[20]

International financing proliferation

Although it was publicly known that China intended to create the Bank, it fell to the backburner in SCO communications.[21]: 116  Throughout the 2010s, China was incredibly active in the foundation of IFIs and other international organizations.[19]: 445  This included the Belt and Road Initiative (BRI) between September and October 2013, the BRICS New Development Bank (BRICS NDB) in July 2014, the Silk Road Fund in December 2014, and the Asian Infrastructure Investment Bank (AIIB) in January 2016.[10]: 21 [22][23][24][25] The BRI was initially launched in 2013 under the name One Belt One Road, but was changed to Belt and Road Initiative in 2016, suspectedly in a shift towards a soft power approach.[26][27]

This was visible through growing economic resiliency of SCO countries throughout this period. The average GDP of SCO countries rose 4.84% in 2016 alone.[21]: 117 

Stagnation despite mentions at 2016–2019 SCO summits

In the years following China's active presence in establishing IFIs, the focus on the SCO Development Bank reemerged as the SCO shifted towards economic cooperation efforts.[28] However, Russia continued to block its development as it preferred the SCO's tradition focus on "combating the 'three evils': terrorism, extremism and separatism. "[15]: 105 

2016 Bishkek SCO summit

Further information: 2016 Bishkek SCO summit

Between 2 and 3 November 2016, the Heads of State of the SCO met in Bishkek, Kyrgyzstan to hold the 2016 Bishkek SCO summit. This shift was evident in the meeting's agenda, which among other key subjects included boosting trade and economic cooperation between members, providing financial support to project launched between 2012 and 2016, and discussing prospective projects between 2017 and 2021.[29] Premier of China, Li Keqiang, requested member states to "continue negotiations on establishing an SCO Development Bank, with a view to reaching agreement on a detailed cooperation modality."[13]

Heads of State of the SCO member countries at the 2017 Astana SCO summit.

2017 Astana SCO summit

Further information: 2017 Astana SCO summit

Between 7 and 10 June 2017, the Heads of State of the SCO met in Astana, Kazakhstan to hold the 2017 Astana SCO summit.[30]: 1  According to the Press Release published by SCO countries:

The heads of state noted the importance of continuing consultations on the establishment of the SCO Development Bank and the SCO Development Fund (Special Account) at the expert level in accordance with the SCO Member States Heads of Government (Prime Ministers) Council decision of 3 November 2016 (Bishkek) with the purpose of financing joint projects within the SCO framework.[30]: 5 

2019 Bishkek SCO summit

Further information: 2019 Bishkek SCO summit

Between 13-14 June 2019, the Heads of State of the SCO met in Bishkek, Kyrgyzstan to hold the 2019 Bishkek SCO summit.[31][32] Although the intention to create the SCO Development Bank was not mentioned in the joint press release following the summit,[33]

SCO Member States, Partners, and Organization heads meet in Tianjin for the 2025 SCO summit.

2025 Tianjin SCO summit

Further information: 2025 Tianjin SCO summit

Russia supported the efforts as it shifted towards Asia following the Ukraine invasion sanctions since 2022.[5] Numerous Chinese officials indicated that the Tianjin summit would formally establish the SCO Development Bank after 10 years of deliberations, despite no timeline for its creation being provided.[34]

Governance and membership

No governance, leadership, or organizational structure is available as of September 2025.

Membership

Main article: Member states of the Shanghai Cooperation Organisation

Membership includes the 10 SCO member states and 17 SCO partners. The SCO's predecessor, the Shanghai Five, included China, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan, ascended by all countries in 1996.[35][36] Uzbekistan joined in 2001, India and Pakistan in 2017, Iran in 2023, and Belarus in 2024.[36]

Notes

  1. ^ Inactive since September 2021 following the aftermath of Taliban takeover of Afghanistan.

References

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  3. ^ Bezpalov, Valery V.; Lochan, Sergey A.; Fedyunin, Dmitry V.; Polozhentseva, Irina V.; Gorina, Tatiana V. (2022-12-22). "Relationship between Complex Integration Indices and Inflation Indicators and Their Impact on the Development of Regional Cooperation between Countries to Reduce the Level of Inflationary Risks: Case of the SCO Member Countries". Risks. 11 (1): 5. doi:10.3390/risks11010005. ISSN 2227-9091.
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  14. ^ a b "温家宝总理访问俄罗斯并举行中俄总理第十五次定期会晤、访问塔吉克斯坦并出席上海合作组织成员国第九次总理会议". Archived from the original on 2020-08-05. Retrieved 2019-10-29.
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  19. ^ a b Hooijmaaijers, Bas (Spring 2021). "Understanding Success and Failure in Establishing New Multilateral Development Banks: The SCO Development Bank, the NDB, and the AIIB". Asian Perspective. 45 (2). Johns Hopkins University Press: 445–467. doi:10.1353/apr.2021.0008 – via Project Muse.
  20. ^ "JOINT COMMUNIQUE Meeting of Heads of Government (Prime Ministers) of the Member States of the Shanghai Cooperation Organization". "The World and Japan" Database from University of Tokyo's National Graduate Institute for Policy Studies Institute for Advanced Studies on Asia. 7 November 2011. Retrieved 20 September 2025.
  21. ^ a b Alimov, Rashid (July 2018). "The Shanghai Cooperation Organisation: Its role and place in the development of Eurasia". Journal of Eurasian Studies. 9 (2): 114–124. doi:10.1016/j.euras.2018.08.001 – via Sage Journals.
  22. ^ WANG, Christoph NEDOPIL (2023-10-12). "Ten years of China's Belt and Road Initiative (BRI): Evolution and the road ahead – Green Finance & Development Center". Retrieved 2025-09-03.
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  29. ^ Upadhyay, Dadan; RIR, specially for (2016-11-07). "Bishkek SCO Meet aims to boost trade and economic cooperation". Russia Beyond. Retrieved 2025-09-04.
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