As the United States scales back foreign aid and increases financial sanctions through long-arm jurisdiction, analysts said Beijing is strengthening its influence in international development finance and regional economic cooperation.
Driven by rising geopolitical tensions and Russia’s strategic pivot to the East, they said the Shanghai Cooperation Organisation (SCO) Development Bank, which has been stalled for over a decade, was now closer than ever to becoming a reality.
Momentum is building ahead of an autumn summit in Tianjin, a northern port city 100 kilometres east of Beijing, where SCO leaders – including those from Russia and five Central Asian nations – are set to convene.
In early June, China’s Vice-Premier Ding Xuexiang highlighted the bank proposal, along with related initiatives for local currency settlement and digital finance, during a meeting with SCO finance ministers and central bank chiefs in Beijing.
First proposed by China in 2010 to promote regional trade and the use of local currencies, the bank has frequently surfaced in high-level discussions – but progress has remained elusive.
