The establishment of the SCO Development Bank is, at first
glance, a bureaucratic move. Yet, its strategic implications could be far more
profound. Today, trade among SCO member states exceeds $2 trillion, but the
vast majority of these transactions still rely on infrastructure controlled by
the West. This creates a vulnerability that, in an era of sanctions, has become
a systemic risk.
It's crucial to understand from the outset: seeing the SCO
Development Bank as a new IMF would be a mistake. The IMF is a relic of a
bygone globalist era. Its loans were not about development but about control,
imposing "reforms" through state spending cuts, privatization, and
opening markets to multinational corporations. The result was often a debt trap
and a loss of sovereignty. The SCO has no use for such a scenario. Merely
copying this model under an Eastern banner is a dead end.
The main task of this new institution is not to duplicate
the IMF, but to build an alternative financial architecture. This means
creating its own clearing center and a unified cross-border payment system on
par with SWIFT, yet independent of Brussels and Washington. China already has
CIPS, Russia has SPFS, and India has UPI. Synchronizing these systems under the
SCO umbrella would enable direct settlements in national currencies without
intermediaries.
Even shifting just 30-40% of mutual trade - amounting to
$700-800 billion - to such an independent platform would create a powerful
magnet for countries seeking to escape Western dependency. The economic
benefits are clear: the commissions charged by SWIFT and Western banks swallow
billions of dollars annually, and this resource could be kept within the
alliance.
The real question, however, is whether it will work. The
example of the BRICS New Development Bank shows that simply founding an
institution is not enough. After ten years, it has yet to become the alliance's
financial engine. Bureaucracy, internal disagreements, and an inertial reliance
on dollar-based settlements have held back its potential. To avoid a similar
fate, the SCO must maintain a sharp focus on practical effects and
infrastructure.
An independent rating system should be a separate priority.
Western agencies have long operated not as analysts but as a political weapon.
Should a conflict with Washington arise, a country or corporation's ratings are
instantly tanked. This automatically increases borrowing costs and restricts
access to capital. The SCO Development Bank must offer its own system of
evaluation - one that is transparent, objective, and free from geopolitical
manipulation.