Statement by Ambassador Khalid Mahmood,
Chairman Institute of Strategic Studies, Islamabad (ISSI)
Shanghai Cooperation Organization Economic Forum
20 October, 2016
Her Excellency Ms. Shakharbanu Zhakupova,
Deputy President, National Economic Academy, Kazakhstan
Honorable Guests,
Ladies and Gentlemen,
It is a privilege and honor for me to participate in this Shanghai Cooperation Economic Forum and to share my views on Economic Integration and Trade System Arrangements among SCO members’ states.
Globalization has increased interdependence of states and as a result of which security and prosperity have become intertwined. Economic integration provides the means to shared development, progress and prosperity. It aims at reduction or elimination of trade barriers and the coordination and harmonization of monetary and fiscal policies. It benefits both consumers and producers and helps stabilize the region.
In this globalized era, interdependence and economic integration presents not only opportunities but also challenges. We need to dig deep inside the opportunities in order to harness the maximum fruits of cooperation. To this end, economic integration among SCO members on the basis of principles of equality, mutual respect, mutual trust and benefit, is very important. It will lead to trade creation, greater employment, efficient movement of goods and services through market expansion. This can help in resolving conflicts peacefully and promote stability in the region.
Ladies and Gentlemen,
The Protocol to the Memorandum of Understanding on Fundamental Goals and Directions of Regional Economic Cooperation 2001 provides a very comprehensive framework and guidelines for promoting regional economic integration. It lays down a mechanism for creation of free trade area, establishment of custom union & common market of goods and services. Likewise, the Cooperation Agreement of the SCO Interbank Consortium presents a detailed framework for economic and monetary union. Moreover, the agreement on Cooperation and Mutual Assistance in Customs Affairs gives a framework to establish a custom union among SCO member states.
In order to promote free flow of capital, goods and technology, member states should work to reach a consensus on establishing a Free Trade Agreement (FTA) at an early date. Meanwhile SCO Business Council and Business Forum as well as Inter-Bank Consortium should enhance their catalytic role. Currency swap arrangements and organizing of Commodity Fairs can also be helpful. Furthermore, on the pattern of Asian Infrastructure Investment Bank, an SCO Development Bank can play a significant role in infrastructure development in the region. We also need to broaden our cooperation to create synergies among various existing mechanisms such as CAREC and Eurasian Economic Union Forum.
Distinguished Ladies and Gentlemen,
SCO is best described by Chinese scholars as a “cart with two wheels”, referring to the equal importance attached to security and economic cooperation. Accordingly Pakistan has embarked on promoting peaceful neighborhood and economic revival and sustainable development by optimally utilizing the country’s geostrategic location to make it a trade and connectivity hub through trade, transport and energy connectivity with China, Central Asia and West Asia. President Xi Jinping’s visionary concept of One Belt-One Road of which China-Pakistan Economic Corridor is a flagship project and Pakistan’s Vision 2025 provide a blueprint for such regional connectivity and integration.
Ladies and Gentlemen,
Structural planning for trade and economic cooperation IS essential for harnessing maximum benefits from economic integration. An institutionalized structure for mutual cooperation in these fields on the basis of equality, mutual respect and openness will help the Members States to promote regional trade, prosperity and harmony.
Excellencies, Ladies and Gentlemen
It is obvious that without a well- structured economic basis, combined with strong political will, the SCO cannot become an influential and effective force. Pakistan looks forward to playing an active cooperative role in the Organization as it is formally inducted as full member of SCO.
Thank you.
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