The 13th Summit of the Economic Cooperation Organisation (ECO) was held in Islamabad, Pakistan, on 1 March 2017. Chaired by Pakistan Prime Minister Nawaz Sharif, the Summit was attended by Presidents of Azerbaijan, Iran, Tajikistan, Turkey, Turkmenistan and Prime Minister of Kyrgyzstan. Besides, the Summit was also attended by Deputy Prime Ministers of Kazakhstan and Uzbekistan. Afghanistan was represented in the Summit by its Ambassador to Pakistan.1
The Islamabad Summit was held after a gap of five years since the last Summit in Baku, Azerbaijan, in 2012 (list of summits is mentioned in Annexure I). The Summit was expected to be held in 2014 in Pakistan.2 However, probably due to certain domestic political compulsions in member countries and international developments, the Summit could not take place in 2014. The Islamabad Summit assumes significance in the wake of multiple integration projects launched by major regional economies, hence the theme ‘Connectivity for Regional Prosperity’.
Background of ECO
The basic Charter of the ECO is based on the ‘Treaty of Izmir’ which was originally signed at Izmir, Turkey, on 12 March 1977 by Iran, Pakistan and Turkey and amended in 1990 and 1992.3 ECO is the successor of Regional Cooperation for Development (RCD) that was in existence for 15 years between 1964 and 1979. The period that saw the RCD giving way to ECO was marked by several significant developments with international and global implications, that include the Islamic Revolution in Iran in 1979 and Soviet intervention in Afghanistan in the same year. Immediately after the collapse of the Soviet Union, the newly independent Central Asian and Caucasus countries along with Afghanistan wanted to open up to the outside world. ECO provided them the opportunity to integrate through a regional bloc. The disintegration of the Soviet Union had a significant impact on the revitalisation of the organisation as it catapulted the three-member ECO to a bigger bloc with the addition of Republics of Central Asia and Caucasus. With its expansion in November 1992, from three to a ten-member organization, ECO gained a new shape, dimension and role. Currently, the ECO members are Afghanistan, Azerbaijan, Iran, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkey, Turkmenistan and Uzbekistan.
Established in 1985 as a trilateral organization of Iran, Pakistan and Turkey, ECO is considered primarily a commercial and trade oriented organisation. The three founding countries equally contribute 66 per cent of the organisation’s total budget.4 ECO’s objective has also been to advance and create conditions for sustained socio-economic growth through multi-dimensional regional cooperation. The organizational structure of ECO comprises a Secretary General (SG) and Seven Directorates, which operate under the guidance of the SG. The Directorates and its distribution among member countries are as follows:
No. |
Directorates |
Countries |
1 |
Directorate of Trade & Investment |
Pakistan |
2 |
Directorate of Transport &Communications |
Iran |
3 |
Directorate of Agriculture, Industry & Tourism |
Turkey |
4 |
Directorate of Energy, Minerals & Environment |
Azerbaijan |
5 |
Directorate of Project & Economic Research & Statistics |
Kazakhstan |
6 |
Directorate of Human Resources & Sustainable Development |
Turkey |
7 |
Drug and Organised Crime Coordination Unit – DOCCU |
Iran |
ECO has formed multiple specialised agencies to undertake scientific, cultural, educational, agricultural, environmental, banking and re-insurance activities by the designated countries. (Details are mentioned in Annexure-II).
13th Summit: Why Now?
The 13th Summit was supposed to be held in 2014 in Pakistan. It was held after a gap of half a decade. Significantly, the Summit coincided with the 25th anniversary of the expansion of the organisation in 1992. It got delayed due to several probable reasons. Pakistan was facing severe security challenges. Major terror attacks, including Peshawar Army Public School in 2014, had aggravated the security situation in the country. On the other hand, Canada-based Pakistani politician and Islamic Scholar Tahir-ul-Qadri had launched protests against Nawaz Sharif-led PML (N) government.
Similarly, Iran, being another founding member of the organisation, was under intense international scrutiny for its nuclear programme. The international sanctions imposed by the UN, EU and the US made any meaningful engagement with Iran virtually less effective since the ECO headquarters is based in Tehran. On the other hand, the third founding member of the ECO, Turkey, was facing domestic political situation and wide-spread protests against President Recep Tayyib Erdogan government.
Regional security situation emanating from the Syrian crisis perhaps also delayed the holding of the Summit in 2014. Turkey was dealing with the flow of displaced Syrian people. Besides, Iran and Turkey had divergent views with regard to the developments in Syria.
Importantly, the postponement of the South Asian Association for Regional Cooperation (SAARC) Summit scheduled in November 2016 in Islamabad had created fear of regional isolation in Pakistan.5 Despite being an ally of ‘war against terrorism’, Pakistan’s role has always been under question. Regional countries have accused Pakistan of allowing its territory to be used as a platform for mounting terror attacks in the region. The isolation factor weighed heavy while holding the Summit. Pakistan’s Minister for Planning and Development Ahsan Iqbal said ‘successful conduct of the ECO summit in Islamabad has proved that Pakistan is not facing isolation but moving forward shoulder to shoulder with developing world.’6 The country tried to use the ECO platform to negate the perception of isolation in the region and beyond.
Pakistan launched military offensive Zarb-e-Azb against militants in June 2014, particularly in the North Waziristan Agency of Federally Administered Tribal Areas (FATA) bordering Afghanistan. Just prior to the Islamabad ECO Summit, the Pakistan Army launched another military offensive known as Radd-ul-Fasaad in February 2017. The military offensives were seen as a small but a positive step by Pakistani government against terrorism. Now, regional countries are forming alliances with Pakistan to deal with the situation in Afghanistan, including Afghanistan, China, Pakistan and Tajikistan ‘anti-terrorism alliance’7 and the recent six party talks on Afghanistan in Moscow.
Developments in the ECO region also helped creating conducive background for holding the Summit at this point in time. Iran has been a founding member of the ECO and the country was under sanctions for a long time affecting the functions and transactions through ECO platform. Currently, many international sanctions have been removed and Iran wants to revive its economy necessitating regional trade and transit cooperation and integration.
Five Central Asian countries constitute half of the 10-member ECO bloc. Due to global economic slowdown and sanctions on Russia these five economies have been facing challenges. They want to diversify their economies as well as explore new markets in the vicinity. These countries have welcomed the initiatives launched by major economies including One Belt One Road (OBOR), International North South Transport Corridor (INSTC), connectivity through port of Iran and the Eurasian Economic Union (EEU). ECO provides them another opportunity and platform to realize their potential for economic and social developments.
Recent convergence among two important ECO members – Iran and Turkey – over the question of Syria and holding of talks in Astana (Kazakhstan, another ECO member) is testimony to the growing bonhomie among ECO members, which helped creating a congenial ground for holding the Summit at this juncture.
Summit Theme
The theme of the Summit was ‘Connectivity for Regional Prosperity’. It points to increasing understanding among regional countries that for mutual prosperity, connectivity at different levels is vital. Pakistan Prime Minister Nawaz Sharif addressing the Summit said, “It is now time for us to reclaim our historic role as Asia’s centre of economic and trade activity. Thus the theme of this Summit, ‘Connectivity for Regional Prosperity’, is both inspired by our shared past and evidence of our commitment to a future of shared prosperity”.8 Speaking at the summit, Turkish President Recep Tayyip Erdogan called for laying greater emphasis on promotion of intra-regional trade for promoting harmony and cooperation in the region.9 Iranian President Hassan Rouhani also emphasised on cooperation and connectivity. He said at the ECO Summit “Let us believe that our power is in our links and the future of the region shall be formed with the decisions we make today and the prosperity of tomorrow depends on our bonds today”.10
Prior to the Summit, while speaking at the 22nd meeting of the ECO Council of Ministers in Islamabad on 28 February 2017, Pakistan’s Foreign Affairs Advisor Sartaj Aziz said long-term prospects of the ECO depended on renewing necessary political will of all member states and finding a common ground in promoting effective regional cooperation and on establishment of efficient and effective institutions which could transfer actual benefits to all member states.11
Summit Outcome
The ECO Summit in Pakistan adopted two distinct documents, the Islamabad Declaration and the Vision 2025. The Declaration emphasised the need for further development of transport and communication infrastructure, facilitation of trade and investment, promotion of connectivity with other regions, effective use of energy resources and undertaking measures for making the ECO effective and efficient. It underlined the need to work towards doubling of the current level of intra-ECO trade in the next three to five years through implementation of the ECO Trade Agreement (ECOTA) and other ECO trade arrangements, and identification and elimination of physical and non-physical barriers affecting the free flow of trade.
In the Summit, it was stated that the ECO region represents a vast expanse of territory that is home to nearly a sixth of all humanity. Though the region has enormous potential and accounts for about 16 per cent of global population, it contributed only 2 per cent to the world trade. Trade within the ECO region is a small fraction of its trade with the rest of the world.12 Intra-regional trade among the ECO member states is currently about eight per cent of their cumulative external trade.13 ECO Secretary General Halil Ibrahim Akca told the leaders that the target was to increase it to over 20 per cent.14
Factors restricting trade and transit in the region include differences in economic capabilities, logistic constraints due to inadequate transport linkages and problems with banking transactions. The Declaration expresses commitment to promote intra-ECO trade as an instrument of enhanced economic cooperation and revitalisation in the region.15 It also calls for building and promoting transport linkages through air, land and sea routes, in addition to cyberspace for boosting intra-regional trade. Regional cooperation in energy sector, including energy infrastructure development, intra-regional energy trade and improving access to affordable energy resources were also stressed.
The Islamabad Declaration further underlined the importance of the Post-2015 Development Agenda and the role that can be played by the ECO member-states. The leaders tasked the ECO secretariat and permanent representatives of member states to introduce reforms in the organisation.16 It further recognised the importance of moderation as an approach to counter all forms of extremism and promote dialogues, mutual respect, understanding and social harmony, to achieve sustainable and inclusive development, equitable growth, stability, and prosperity in the ECO Region.
The ECO Vision-2025 adopted at the Islamabad Summit identified sustainability, integration and conducive environment as the core principles for increasing cooperation in trade, transport, connectivity, energy, tourism, economic growth and productivity, social welfare and environment.17 The document further states ‘ECO will pave the way to a territory of integrated and sustainable economies as well as free trade area achieved by highly educated societies and improved governance through enhanced cooperation’. The ECO Vision 2025 envisages the ECO to become a territory of integrated and sustainable economies as well as free trade area through enhanced cooperation.18
ECO in Regional Stability and Connectivity
The leaders observed that the unresolved conflicts were hindering economic growth, preventing realisation of full economic potential of the region and impeding economic cooperation on regional and broader levels. Acknowledging the importance of Afghanistan for the ECO Region, the Summit emphasised its continued support to national, regional and global efforts for reconstruction and sustainable development as well as peace and security in Afghanistan.19 The Summit expressed concern over ongoing conflicts in the region and called for their early resolution based on norms and principles of international laws and respect to sovereignty and territorial integrity of the affected states. With representatives emphasising on enhanced connectivity, Afghanistan’s Ambassador to Pakistan and President Ashraf Ghani’s Special Envoy to the Summit, Dr. Omar Zakhilwal, pointed towards the continued closure of Pak-Afghan border crossings by Pakistani authorities and demanded immediate reopening. After remaining closed for about a month, Pakistan Prime Minister ordered immediate reopening of the border on 20 March 2017.20
Connectivity initiatives launched by major economies have increased the prospects of regional integration of ECO members. The China-led OBOR initiative covers all ECO member states. The rail and road network created by China is likely to benefit entire ECO Region enabling them to ease and increase their intra-ECO connectivity. On the other hand, INSTC, which includes India and connects South Asia to Central Asia, and the Indian investments in the Iranian port of Chabahar to connect with Afghanistan and beyond, further widen the channels of transport and communication among the ECO members through neighbouring countries and regions.
Challenges & Way Forward
ECO has been facing the challenges of connectivity and economic disparity among its members, which in turn, has been hampering greater cooperation. Turkey constitutes more than 45 per cent of the total GDP of the ECO economy, while Kyrgyzstan’s share is less than 1 per cent.21 Nevertheless, in the wake of increasing connectivity and multiple initiatives and inter-region projects, the prospects for ECO have got renewed momentum.
The 13th ECO Summit held in Pakistan has rekindled the hope of greater economic, political and cultural cooperation among member countries. The prosperity and stability achieved and sustained by ECO member countries will not remain limited to the ECO region, rather, it will have spill over effect benefitting South Asia, Central Asia, other countries and regions.
ECO and SAARC are the two contemporary initiatives launched by developing countries for economic cooperation and regional integration. Their performance so far has been below potential. The challenges faced by the two regional organisations, including socio-economic development, connectivity and security, are similar in nature. Greater synergy between SAARC and ECO can multiply the benefits of economic cooperation, political engagement and cultural interactions.
***
* The Authors are Research Fellows at ICWA, New Delhi.
Disclaimer: Views expressed are of author and do not reflect the views of the Council.
End Notes
1 13th Summit of the Economic Cooperation Organization (ECO) Islamabad, 1 March 2017, Ministry of Foreign Affairs Government of Pakistan, http://www.mofa.gov.pk/pr-details.php?mm=NDgwOA,,
2 Dunya News, “Pakistan to host next ECO Summit in 2014”, October 17, 2012, http://dunyanews.tv/en/Business/138303-Pakistan-to-host-next-ECO-Summit-in-2014
3 Treaty of Izmir, ECO Secretariat, www.ecosecretariat.org/ftproot/Documents/Basics/Treaty_of_Izmir.doc
4 Ministry of Foreign Affairs, Turkey, “Turkey’s relations with the Economic Cooperation Organization (ECO)”, http://www.mfa.gov.tr/turkey-and-the-economic-cooperation-organization-_eco_.en.mfa
5 Rezaul Karim and Shakhawat Liton, “Saarc Summit: Pakistan faces regional isolation”, The Daily Star, September 29, 2016, http://www.thedailystar.net/frontpage/saarc-summit-called-pakistan-faces-regional-isolation-1291261
6 The Nation, “ECO summit proves Pakistan is not isolated: Ahsan”, March 2, 2017, http://nation.com.pk/national/02-Mar-2017/eco-summit-proves-pakistan-is-not-isolated-ahsan
7 Michael Martina, “China joins Afghanistan, Pakistan, Tajikistan in security alliance,” Reuters, August 4, 2016, http://www.reuters.com/article/us-china-security-idUSKCN10F1A6
8 Prime Minister’s Office, Government of Pakistan, “Statement by the Prime Minister for the Inauguration Session of the Summit”, March 1, 2017, http://www.pmo.gov.pk/pm_speech_details.php?speech_id=82
9 Dawn, “ECO summit for doubling intra-regional trade”, March 2, 2017, http://epaper.dawn.com/DetailImage.php?StoryImage=02_03_2017_005_004
10 President of Iran, “President Rouhani at ECO Summit: 21st century the century of Asia’s leadership/ECO to be key to east-west interaction/ECO can, and must, have a role in future economy of region/Cooperation, coordination in confronting terrorism/ECO a good base for having more secure region for our nations”, March 01, 2017, http://president.ir/en/98040
11 Press Information Department, Government of Pakistan, “Statement by Mr. Sartaj Aziz, Adviser to the Prime Minister on Foreign Affairs on the Occasion of 22nd Economic Cooperation Organization (ECO) Council of Ministers Meeting (COM), Islamabad February 28, 2017”. http://www.pid.gov.pk/?p=35501
12 Prime Minister’s Office, Government of Pakistan, “Statement by the Prime Minister for the Inauguration Session of the Summit”, March 1, 2017, http://www.pmo.gov.pk/pm_speech_details.php?speech_id=82
13 ECO Islamabad Declaration, Ministry of Foreign Affairs, Government of Pakistan, March 1, 2017, http://www.mofa.gov.pk/pr-details.php?mm=NDgwNA,,
14 ECO summit for doubling of regional trade, Dawn, March 2, 2017, https://www.dawn.com/news/1317903
15 Islamabad Declaration, Ministry of Foreign Affairs, Government of Pakistan, March 1, 2017.
17 Ministry of Foreign Affairs, Government of Pakistan, “ECO Vision 2025,” March 1, 2017, http://www.mofa.gov.pk/pr-details.php?mm=NDgwNw,,
18 Ministry of Foreign Affairs, Pakistan, “13th Economic Cooperation Organization (Eco) Summit, (26 February - 01 March 2017, Islamabad). Press Conference by Adviser to the Prime Minister on Foreign Affairs (25 February 2017)”, February 25, 2017, http://www.mofa.gov.pk/pr-details.php?mm=NDc5MQ,,
19 “United we stand: ECO”, The Daily Times Pakistan, March 2, 2017, http://dailytimes.com.pk/pakistan/02-March-17/united-we-stand-eco
20 Dawn, “Nawaz orders immediate reopening of Pak-Afghan border”, March 20, 2017, https://www.dawn.com/news/1321704
21 Economic Cooperation Organisation, “ ECO Annual Economic Report – 2014,” http://www.ecosecretariat.org/ftproot/Publications/Annual_Economic_Report/20141/ARE2014.pdf
Summits |
Year |
Country |
1. |
February 1992 |
|
2. |
May 1993 |
|
3. |
May 1995 |
|
4. |
May 1996 |
|
5. |
May 1997 |
|
6. |
May 1998 |
|
7. |
June 2000 |
|
8. |
October 2002 |
|
9. |
September 2004 |
|
10. |
May 2006 |
|
11. |
March 2009 |
|
12. |
December 2010 |
|
13. |
October 2012 |
|
14. |
March 2017 |
Sources: compiled from various sources
Annexure- II
ECO Specialized Agencies
S No. |
Name of Institute |
Based at |
1 |
ECO Cultural Institute (ECI) |
Tehran, Iran |
2 |
ECO Science Foundation (ECOSF) |
Islamabad, Pakistan |
3 |
ECO Educational Institute (ECOEI) |
Ankara, Turkey |
4 |
ECO Consultancy & Engineering Company (ECO-CEC) |
Lahore, Pakistan |
5 |
ECO College of Insurance (ECOCI) |
Tehran, Iran |
6 |
ECO Trade Development Bank (ECOTDB) |
Headquarters located in Istanbul, Turkey, Two representative offices established in Tehran (2009) and Karachi (2010) |
7 |
ECO Chamber of Commerce and Industry (ECO-CCI) |
As per agreed formula, the location of the Secretariat of ECO-CCI is rotated among the members. Presently, it is located in Karachi, Pakistan |
8 |
ECO Institute of Environmental Science and Technology (ECO-IEST) |
Karaj, Iran |
9 |
ECO Postal Staff College |
Islamabad, Pakistan |
10 |
ECO Seed Association (ECOSA) |
Ankara, Turkey |
11 |
ECO Regional Centre for Risk Management of Natural Disasters |
Mashhad, Iran |
12 |
ECO Regional Coordination Centre (RCC) for the Implementation of the Regional Programme for Food Security (RPFS) |
Ankara, Turkey |
13 |
ECO Reinsurance Company |
The company will be established following the ratification by Turkey and payment of full subscription of share capital by the three contracting member countries |
Source: Ministry of Foreign Affairs, Pakistan, “13TH ECONOMIC COOPERATION ORGANIZATION (ECO) SUMMIT, (26 FEBRUARY - 01 MARCH 2017, ISLAMABAD). Press Conference by Adviser to the Prime Minister on Foreign Affairs (25 February 2017)”, 25 February 2017. http://www.mofa.gov.pk/pr-details.php?mm=NDc5MQ,,