Hamidreza Azizi

ECO and Economic Multilateralism Triangle in Eurasia

Date of publication : March 26, 2017 11:57 am
Prime Minister of Pakistan Nawaz Sharif (R-6), President of Iran Hassan Rouhani (R-5), Turkish President Recep Tayyip Erdogan (R-4) and other leaders pose for a photo during the 13th Economy Cooperation Organization Summit in Islamabad, Pakistan on March 1, 2017
Prime Minister of Pakistan Nawaz Sharif (R-6), President of Iran Hassan Rouhani (R-5), Turkish President Recep Tayyip Erdogan (R-4) and other leaders pose for a photo during the 13th Economy Cooperation Organization Summit in Islamabad, Pakistan on March 1, 2017
Islamabad, Pakistan’s capital, hosted the 13th Summit of the Economic Cooperation Organization (ECO) on March 1, 2017. At the meeting in which the rotating presidency was given from Azerbaijan to Pakistan, Hassan Rouhani, Iran’s President, also attended, and made a speech. In his speech, Mr. Rouhani talked about the fact that there was no obstacle to developing and deepening the cooperation in the ECO region, and mentioned the necessity of implementing the available projects in the context of the organization, but the shadow of existing disagreement and differences - what has led so far to the inefficiency of the ECO - still continues to overshadow the organization. However, this does not mean there is no capacity to move forward.
So much has been said and written about the causes of inefficiency and failure of the ECO to achieve the goals set for it more than three decades ago, and many sources placed this issue on the agenda to be reread on the eve of the recent meeting. Issues ranging from the lack of economic complementary between members of the organization to business extroversion and the feeling that there are no equal interests are all being mentioned in this context. But beyond all these cases, what mattered most as the obstacle to the success of the organization are the political differences among the members seriously manifested this time in the Islamabad meeting as well.
Within the framework of political differences, issues such as competitive agendas of Iran and Turkey, the enduring cynicism between Tajikistan and Uzbekistan, the long-standing hostility between Afghanistan and Pakistan and occasional disagreements between Iran and some Central Asian countries - the most recent event is the disagreement with Turkmenistan over the issue of natural gas exports - are noteworthy. On the eve of the recent meeting, intensified disputes between Kabul and Islamabad resulted in the intentional absence of Afghanistan in the meeting. On the other hand, this meeting was held in conditions that due to some positions of the Turkish high-ranking officials against Iran, an unfavorable climate also dominated the relations between Tehran and Ankara.
In such circumstances, the question is that was it only a ceremonial gathering of heads of the ECO member countries, or as Mr. Rouhani and his foreign minister, Javad Zarif, pointed out during the meeting, we can be hopeful to see the enhanced cooperation in the framework of the organization and its growing progress? This question can be answered by presenting some main issues.
The Possibility of “Cooperation”, yet Refusing to “Converge”
The first and perhaps the most important issue that should be considered in the discussion on the ECO and its prospects is the necessity to maintain the expectations from the organization at a reasonable level, and not to extend the area of its activities to other areas which are basically impossible for it to work within. In this regard, first of all it is necessary to make one thing clear for good: the ECO is an organization for “cooperation”, and has been established with this purpose, and it is fundamentally unrealistic to expect it to become a forum for “convergence”.
The formation of the Organization for Regional Cooperation for Development (RCD) as the primary core of the ECO in 1964, the time when Europe was taking its first steps toward “convergence”, and “neo-functionalist” theorists were also diligently conceptualizing the “process” or “state” of the regional convergence, many thought to find partners for the emerging European Union in other regions to strengthen the generalizability of these theories.
According to the logic of functionalism, the cooperation which starts in the field of “low politics” - the economic and technical cooperation - can “spill over” to the cooperation in the field of “high politics”, and bring about the situation in which governments while ignoring some of their authority, form the transnational organization beyond the jurisdiction of any of the individual members. This process followed, more than anything, the European experience in moving from the “Coal and Steel Community” to “the European Union”.
In brief, the decline and resurgence of the “RCD”, this time in the form of the ECO in 1985, and then the accession of new members after the Soviet Union collapsed in the early 1990s, the decade that witnessed the emergence of a new wave of regionalism theories, pushed many to analyze this organization within the framework of theories of convergence. However, the most important missing link among the ECO countries was the key for the European convergence: the distinction between low politics and high politics. In other words, in the space severely securitized due to a combination of factors in different areas of the member states, primarily the fundamental logic of convergence is under question, and it cannot be taken as a baseline.
In a lower level, the ECO cannot be and should not be expected to become a forum to settle rivalries, disagreements and tensions between members, because these disagreements have a different nature, and they are present in a region with unique features that make it difficult to resolve them.
However, this unique feature has made the ECO members to cooperate in the economic sphere always with a pragmatic view while having disagreements. Even in the most stressful periods of Turkish-Iranian relations, the two countries have not abandoned their vast economic interactions. Despite all the differences, Central Asian countries had and still have an interconnected economic life. Accordingly, the best the ECO members can do is to identify the potential areas of cooperation based on a pragmatic view, and move toward developing economic cooperation without essentially waiting for the formation of the convergence process.
The Post-JCPOA Iran and the Potential Capacities of the ECO
In the Islamabad meeting, Mr. Rouhani started his speech by referring to the nuclear deal between Iran and the P5+1 group (the JCPOA), and outlined its achievements. He called the Joint Comprehensive Plan of Action (JCPOA) a global agreement approved by the UN Security Council, and emphasized that: “I strongly believe that the normalization of trade relations between Iran and the world not only benefits our people, but also benefits all countries in the region.”  
It can be said that choosing the topic of the JCPOA as a point of departure of the speech is a clever and meaningful action by Mr. Rouhani done based on the current realities of the region and the international arena. In fact, at the heart of this discussion lies a reference to Iran’s pivotal role in the formation and survival of the ECO, and that the change in the conditions of this main pivot of the organization can lead to changes in its totality.
If 1993, when the ECO took the current form with the accession of new members, is taken as the baseline, the life of the organization, as we know it now, is not more than a quarter century. About a decade of this time is the period in which the Islamic Republic of Iran was under the most severe unilateral and multilateral sanctions due to the gradual escalation of the nuclear issue; sanctions that targeted the core of what the ECO was formed for - the “economy” and economic cooperation.
It is clear that in these conditions, the fact that Iran was focusing on finding a solution to the nuclear issue and ending the sanctions, on the one hand, and considerations of other members of the organization - mainly due to the existing pressures and growing ties with the West - on the other hand, moved Iran out of the centrality of economic cooperation as one of the three main pillars of the organization and the host country of its Permanent Secretariat. Now, and in the post-JCPOA space where Iran has put the development of international economic relations as part of its agenda, Iran’s activities, if adopting appropriate measures and policies, can bring about the dynamics of the organization after years of inaction.
ECO as One Side of the Economic Multilateralism Triangle in Eurasia
The 13th Summit of the ECO was held in conditions that over the past few years, almost all members of the organization at least have been involved in one of the two other multilateral initiatives observing the Eurasian Economic Cooperation, and/or have expressed their interest to enter them: the Chinese project “Silk Road Economic Belt” (an initiative also called One Belt, One Road) and the Russian project the “Eurasian Economic Union”. Iran, particularly after the nuclear deal, has attracted the attention of the masterminds of both initiatives as a potential partner.
In the meantime, what we witness in the current climate of the Central Eurasia is the plan of the two great powers in this area - Russia and China - to move toward a greater economic cooperation, while there are “potential” aspects of political competition which an example of which can be seen in the two leaders’ agreement on linking the two initiatives. China tending to access a more open space in terms of geopolitics for advancing the long-standing project of developing the elements of its power, and Russia mainly aiming to find an alternative to the cooperation with the West in the wake of the crisis in Ukraine in 2014, and reconstruct its damaged economy from sanctions, have placed Eurasian economic multilateralism on their agenda.
In these circumstances, if the ECO can also achieve a framework and structure for the first time identified and accepted by all parties in the field of economic cooperation, it can form, as a more or less integrated economic actor, the third side of the Central Eurasian multilateral economic cooperation triangle. This is especially important, since the two other initiatives are still at the stage of construction and recruitment, but the ECO passing this process, only requires the political will necessary to become a multilateral cooperation structure.
In that case, we can hope China’s economic power and Russia’s political power along with the pre-existing structure of the ECO prepare the grounds for an economic multilateralism from East to West and from North to South Eurasia; it may seem a bit idealistic in the current phase, but it is not completely out of reach.

Hamidreza Azizi, an assistant professor at Shahid Beheshti University (SBU), is the fellow at IRAS.

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ID: 3109
Author : Hamidreza Azizi