China Pushes for Establishment of SCO Development Bank at Annual Summit

Chinese President Xi Jinping announced on Monday at the Shanghai Cooperation Organization (SCO) annual summit in Tianjin that China will accelerate efforts to establish an SCO Development Bank.

In his opening address, Xi noted that the world is becoming increasingly complex and turbulent, and SCO member states are facing mounting security and development challenges. He also pledged $1.4 billion in loans to SCO member nations over the next three years, clarifying that the funds are not solely dedicated to the proposed new bank.

The summit brought together top leaders from China, Russia, India, Iran, and several other nations. Established in 2001, the SCO currently has 10 member states, with Afghanistan and Mongolia as observers and 14 other countries engaged as dialogue partners.

China has positioned the summit as an opportunity to expand its diplomatic influence. Traditionally seen as a security forum, the SCO could shift toward development and economic cooperation if the proposed bank and lending programs move forward.

Russian President Vladimir Putin, in remarks ahead of the summit, emphasized Russia–China partnership, opposing what he called “discriminatory sanctions.” He also urged reforms in global financial institutions like the IMF and World Bank, stressing that finance should not be used as a tool of neo-colonialism.

However, experts suggest that the SCO still primarily focuses on security issues. Critics argue that the organization’s counterterrorism exercises often serve more to protect authoritarian regimes than to combat real terrorism.

Nevertheless, Xi’s latest diplomatic push and the proposal to establish a development bank could strengthen the SCO’s role as a more influential platform in global governance.