Bloc's trade stance to aid global growth

A light show color the Qingdao skyline during a performance to welcome leaders attending the 18th Shanghai Cooperation Organization Summit in Shandong province on Saturday. [Photo/VCG]

The enhanced economic ties between Shanghai Cooperation Organization members will not only create fresh growth momentum within the bloc, but also push economic integration across Eurasia, according to officials and experts.

Many opportunities will come from the urbanization and industrialization in SCO nations, as well as the growing demand in other parts of Asia and Europe for goods and new business models such as e-commerce, economic zones, multimodal transportation, and upgraded digital and financial services, they said.

Yu Jianlong, secretary-general of the China Chamber of International Commerce, said that as the SCO has entered the next stage in its development, its member economies now have more strength to jointly tackle global challenges and further develop markets in Europe, the Middle East and Africa through the Belt and Road Initiative.

China and other members are also exploring ways to integrate the Belt and Road with regional cooperation programs and national development plans, he said.

"Although trade protectionism seems to be on the rise and European integration is suffering setbacks, China and other SCO members share a common stance on many major issues," said Xue Rongjiu, deputy director of the China Society for WTO Studies. "They agree on economic globalization and multilateralism, the opposite of protectionism."

To avoid risks from the global financial market, companies in SCO nations are being encouraged to use domestic currencies to seal deals, build e-commerce platforms to save on operating and trading costs, and foster cooperation between customs authorities, Xue said.

China's total trade with fellow SCO members rose by 19 percent year-on-year to $217.6 billion last year, with notable growth in exports of electromechanical products, construction machinery, and automobiles and auto parts, according to data from the Ministry of Commerce.

As of March, China had invested $84 billion in other SCO members, mainly in large-scale projects in the energy, minerals, transportation, construction and manufacturing sectors, including the China-Kyrgyzstan-Uzbekistan highway.

As economic growth in many SCO members relies heavily on trade in commodities, some countries often face losses due to the low prices of resources such as coal, natural gas and crude oil on the global market.

"Under such circumstances, all member states should continue to take bigger steps toward promoting trade and investment facilitation and liberalization," said Xu Hongcai, an economist at the China Center for International Economic Exchanges.

He said it is important for SCO countries to expand trade, improve trade structures, and simplify their business, customs, quality inspection and transportation policies.

Many members of the bloc are emerging economies and developing countries in the process of industrialization characterized by stable growth and enormous potential for future development, Xu added.