In Russia the 9th SCO summit is under way and the 1st between Brazil, Russia, India and China. The creation of a free trade zone, transport corridors and reserve currency will dominate talks. Beijing wants to increase its economic role, even through a series of bilateral relationships.

Beijing (AsiaNews/Agencies) –China’s president Hu Jintao has flown to Yekaterinburg (Russia) to take part in the 9th annual Shanghai Cooperation Organization (Sco) summit, to discuss the economic crisis and collaboration. The Russian city will also host the 1st summit between the 4 major emerging economies: Brazil, Russia, India and China (so-called “Bric”).

The Sco, formed in 2001 by China, Russia and the four Central Asian nations of Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan to curb extremism in the region and enhance border security, has also become a privileged negotiating table to discuss collaboration between central Asian states and the two regional giants China and Russia.  India, Pakistan, Iran and Mongolia are observer members.

Trade between China and the other five full members has grown from 12billion dollars in  2001 to 68 billion in 2007. Beijing buys energy in exchange for services and refined goods. But trading between Sco members fell in 2008.  In the current economic climate Beijing is insisting on the adoption of coordinated economic measures and greater collaboration between Sco states, to maintain their economic growth.  Among projects under discussion is the creation of a common economic market and a trade corridor.

The deteriorating situation in Afghanistan will also be discussed and North Korea’s nuclear tests.  Moscow and Beijing are trying to find common ground also in an effort to present themselves as an alternative to the United States.

But global attention is focused on the first summit of the Bric states opening tomorrow.  Expectations are high to see if these nations will be able to coordinate their policies and take on shared positions in a world where trade and rules are of increasing importance.  Russia and Brazil have already announced their intention to sell their US dollars reserves, to decrease its importance as the currency of reference, and to diversify their own reserves.

Zhou Dunren, economics professor at Fudan University, Shanghai, forecasts that Beijing has no intention of selling its dollars (considering that the Chinese reserves are for the most part in dollars), but rather launch bilateral programs in respective currencies to increase their importance and at the same time decrease their dependency on the dollar.

Following the summits Hu will continue on state visits to Russia, Slovakia and Croatia.

 

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