OPINION
Market Rating Before FOMC MeetingJan 31
What Out of the Shanghai Cooperation Organization (SCO) Summit?
The 22nd meeting of the Shanghai Cooperation Organization (SCO) Summit was concluded on September 15-16. At the summit held in the city of Samarkand, chaired by Uzbekistan this year, the interviews and messages of the leaders were followed closely.
The Organization, which was first established in 1996, included 5 member countries. The member states consisting of the People's Republic of China, Russia, Kazakhstan, Kyrgyzstan, and Tajikistan were called the "Shanghai Five". Later on, over time, with the participation of Uzbekistan, India, Pakistan, and finally Iran in 2021, there are 9 member countries of the organization.
At the summit, where Chinese President Xi Jinping traveled abroad for the first time since the coronavirus pandemic, his interview with Russian President Vladimir Putin was closely followed. Russian leader Putin, who thanked China for its balanced stance on the Ukraine war, said that the US effort to create a unipolar world would fail. On the other hand, Chinese Leader Jinping did not talk about the Ukraine war but noted that they are willing to work together with Russia as a great power.
One step behind: The two leaders had met face-to-face again just a few weeks before Russia's invasion of Ukraine on February 24 and announced that they had declared an unlimited partnership, promising greater cooperation against the West.
President Recep Tayyip Erdoğan, who joined the SCO as a 'special guest' for the first time, met with the leaders one by one. At the summit, the meeting between Erdoğan and Russian President Putin for approximately 40 minutes, which was closed to the press, drew attention
After the meeting, Putin thanked President Erdogan for his contributions to the grain agreement and announced that the agreement on making %25 of the payments for the shipment of Russian gas to Turkey in Russian rubles will come into force soon. Putin added that Turkey has become one of the most reliable routes for natural gas shipments from Russia, including Europe, and that TurkStream is running smoothly.
After his visit to the SCO, President Erdoğan underlined that Turkey's presence here is important in terms of emphasizing its priorities and expressing the contributions it can provide to fundamental issues concerning the organization, and gave the green light to become a member of the organization by mentioning that they will develop bilateral and multilateral relations with continental countries.
At the end of the 2-day summit, member leaders announced the Samarkand Declaration. In the said declaration, it was emphasized that SCO member countries are not an organization against other states and international organizations, while leaders were informed that they are open to cooperation. In addition, the leaders mentioned that the World Trade Organization (WTO) should increase its effectiveness by taking into account global economic difficulties.
Condemning the unilateral development of missile defense systems by some countries, the leaders stressed the need to sign an internationally and legally binding document that could guarantee the prevention of an arms race in space.
Finally, while emphasizing the importance of implementing the action plan regarding Iran's nuclear program, it was underlined that the provisions of the Treaty on the Non-Proliferation of Nuclear Weapons should be strictly followed. It was informed that the next summit to be held in 2023 will be held under the chairmanship of India.
During the meetings within the scope of the SCO, the eyes were on the close communication between Erdogan and Putin. Especially in the shadow of the energy crisis on the West-Russia line, the fact that Turkey will receive natural gas payments in TL at a discounted rate has drawn attention to Erdogan on the European side. It should be noted here that Turkey did not impose any sanctions on Russia for its invasion of Ukraine.
It is a matter of curiosity where this development between the two leaders will lead, as internationally renowned news agencies have suggested that the heavily sanctioned Russian ruble pierced the swift channel through Turkish banks. However, the West's somehow targeting the Turkish financial system in this regard may increase the fragility of the TL by supporting Turkey's 5-year risk premium (CDS), which is already over 700 basis points. Nevertheless, it is also true that the Turkish economy will complete the winter season with a lighter gas bill than in Europe.
The Organization, which was first established in 1996, included 5 member countries. The member states consisting of the People's Republic of China, Russia, Kazakhstan, Kyrgyzstan, and Tajikistan were called the "Shanghai Five". Later on, over time, with the participation of Uzbekistan, India, Pakistan, and finally Iran in 2021, there are 9 member countries of the organization.
At the summit, where Chinese President Xi Jinping traveled abroad for the first time since the coronavirus pandemic, his interview with Russian President Vladimir Putin was closely followed. Russian leader Putin, who thanked China for its balanced stance on the Ukraine war, said that the US effort to create a unipolar world would fail. On the other hand, Chinese Leader Jinping did not talk about the Ukraine war but noted that they are willing to work together with Russia as a great power.
One step behind: The two leaders had met face-to-face again just a few weeks before Russia's invasion of Ukraine on February 24 and announced that they had declared an unlimited partnership, promising greater cooperation against the West.
President Recep Tayyip Erdoğan, who joined the SCO as a 'special guest' for the first time, met with the leaders one by one. At the summit, the meeting between Erdoğan and Russian President Putin for approximately 40 minutes, which was closed to the press, drew attention
After the meeting, Putin thanked President Erdogan for his contributions to the grain agreement and announced that the agreement on making %25 of the payments for the shipment of Russian gas to Turkey in Russian rubles will come into force soon. Putin added that Turkey has become one of the most reliable routes for natural gas shipments from Russia, including Europe, and that TurkStream is running smoothly.
After his visit to the SCO, President Erdoğan underlined that Turkey's presence here is important in terms of emphasizing its priorities and expressing the contributions it can provide to fundamental issues concerning the organization, and gave the green light to become a member of the organization by mentioning that they will develop bilateral and multilateral relations with continental countries.
At the end of the 2-day summit, member leaders announced the Samarkand Declaration. In the said declaration, it was emphasized that SCO member countries are not an organization against other states and international organizations, while leaders were informed that they are open to cooperation. In addition, the leaders mentioned that the World Trade Organization (WTO) should increase its effectiveness by taking into account global economic difficulties.
Condemning the unilateral development of missile defense systems by some countries, the leaders stressed the need to sign an internationally and legally binding document that could guarantee the prevention of an arms race in space.
Finally, while emphasizing the importance of implementing the action plan regarding Iran's nuclear program, it was underlined that the provisions of the Treaty on the Non-Proliferation of Nuclear Weapons should be strictly followed. It was informed that the next summit to be held in 2023 will be held under the chairmanship of India.
During the meetings within the scope of the SCO, the eyes were on the close communication between Erdogan and Putin. Especially in the shadow of the energy crisis on the West-Russia line, the fact that Turkey will receive natural gas payments in TL at a discounted rate has drawn attention to Erdogan on the European side. It should be noted here that Turkey did not impose any sanctions on Russia for its invasion of Ukraine.
It is a matter of curiosity where this development between the two leaders will lead, as internationally renowned news agencies have suggested that the heavily sanctioned Russian ruble pierced the swift channel through Turkish banks. However, the West's somehow targeting the Turkish financial system in this regard may increase the fragility of the TL by supporting Turkey's 5-year risk premium (CDS), which is already over 700 basis points. Nevertheless, it is also true that the Turkish economy will complete the winter season with a lighter gas bill than in Europe.
