My guess is that the SCO rules are and always have been in flux. Lots of exceptions can be made when the strategic calculus is overwhelmingly in favor. Turkey's case is not one of those. India and Pakistan are both nuclear powers with huge populations. Pakistan has close ties to China and India has close ties to Russia. I imagine that is the reason.
Shanghai Cooperation Organisation (SCO) and Global South strategic cooperation
- Thread starter Strangelove
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My guess is that the SCO rules are and always have been in flux. Lots of exceptions can be made when the strategic calculus is overwhelmingly in favor. Turkey's case is not one of those. India and Pakistan are both nuclear powers with huge populations. Pakistan has close ties to China and India has close ties to Russia. I imagine that is the reason.
If we stick to the texts of the chatter neither India nor Pakistan should have joined. But both of them want to join SCO and China prefers India in SCO than fully fall in US orbit, choose the bad over the worst. Texts are just an argument or excuse, essence matters the most.
Also take a look at NATO, Greece and Turkey, UK and Spain have territorial disputes, that does not stop them being in NATO defending each other against each other's possible aggressions. What an irony?
I think Turkey is in the progress of bargaining with US using its overture to SCO. IF (a big if) Turkey is serious of joining SCO, it has to make a choice, SCO or NATO, not both.
It also worth to watch India. India is part of QUAD, a dialogue in name. If QUAD overtly becoming a NATO like organization, India should and will be expelled by SCO. Even if Russia object, China will bring out the chatter. But I think it won't go that far because India is always fence-sitting therefor won't ruin its benefit.
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Digital BRI
A large part of China's BRI initiative also rests upon its ability to build out digital infrastructure around the world. The Chinese effort to expand its digital infrastructure is most apparent in Southeast Asia and now Russia.
As I discussed in the science/technology thread #12,741 and #12,866, one of the more obvious recent trend is Chinese tech firm's ability to expand in cloud space. Both Alibaba and Huawei has made real in road in the cloud space and servers and such. With Western companies pull out, the next obvious place of in road for Chinese tech companies is Russia (assuming they are not fearful of sanctions).
As described here, Alibaba and Tencent have invested a lot. Lazada is a huge success in the region and is expanding. Alibaba itself has made significant in road in Malaysia and KL was the location of Alibaba's first Innovation center as part of the Project AsiaForward. It makes a lot of sense that Chinese tech companies would be able to first gain influence in places where its culturally familiar.
As described here. Digital silk road allows China to push its fintech product to Southeast Asia. It has used its price advantage to "lock up" ASEAN market. And Alibaba has found the solid strategy of using its enormous capital to buy out local firms and expand that way.
Interesting parts here. Traffic from Asia is stay in Asia. So Asians are finding enough local content to not look in EU/US.
Due to the pandemic, there was a huge search in Internet traffic in Asia. There is still relatively low internet penetration in Asia, so Chinese firms move to build itself up in the infancy stage should yield benefits as the internet population continue to grow in Asia.
DSR presence in Indonesia
Chinese smartphones dominate in Indonesia. Chinese cell phone towers dominate there and so do the cloud infrastructure. Huawei is the biggest trainer of local ICT industry. Alibaba has invested large amount of money to build its presence in Indonesia ahead of a possible amazon incursion. There is growing penetration of Alipay and WeChat pay in Indonesia.
A large part of China's BRI initiative also rests upon its ability to build out digital infrastructure around the world. The Chinese effort to expand its digital infrastructure is most apparent in Southeast Asia and now Russia.
As I discussed in the science/technology thread #12,741 and #12,866, one of the more obvious recent trend is Chinese tech firm's ability to expand in cloud space. Both Alibaba and Huawei has made real in road in the cloud space and servers and such. With Western companies pull out, the next obvious place of in road for Chinese tech companies is Russia (assuming they are not fearful of sanctions).
As described here, Alibaba and Tencent have invested a lot. Lazada is a huge success in the region and is expanding. Alibaba itself has made significant in road in Malaysia and KL was the location of Alibaba's first Innovation center as part of the Project AsiaForward. It makes a lot of sense that Chinese tech companies would be able to first gain influence in places where its culturally familiar.
As described here. Digital silk road allows China to push its fintech product to Southeast Asia. It has used its price advantage to "lock up" ASEAN market. And Alibaba has found the solid strategy of using its enormous capital to buy out local firms and expand that way.
Interesting parts here. Traffic from Asia is stay in Asia. So Asians are finding enough local content to not look in EU/US.
Due to the pandemic, there was a huge search in Internet traffic in Asia. There is still relatively low internet penetration in Asia, so Chinese firms move to build itself up in the infancy stage should yield benefits as the internet population continue to grow in Asia.
DSR presence in Indonesia
Chinese smartphones dominate in Indonesia. Chinese cell phone towers dominate there and so do the cloud infrastructure. Huawei is the biggest trainer of local ICT industry. Alibaba has invested large amount of money to build its presence in Indonesia ahead of a possible amazon incursion. There is growing penetration of Alipay and WeChat pay in Indonesia.
On the Yuan usage front, it's quite clear that Russia is pushing Yuan adoption faster than China is doing. At this point, Yuan utility is still not that great, so China will need to push forward the usage of Yuan in energy and commodity trading a lot more. I was disappointed they didn't announce more on that front during SCO meeting. It seems to me the next step is to push PetroYuan with Saudi and other Middle Eastern countries as well as other global south partners like Angola, Malaysia and Central Asian countries
Having other countries issue Yuan denominated bonds is a great thing, but China itself needs a more developed local bond market.
Having other countries issue Yuan denominated bonds is a great thing, but China itself needs a more developed local bond market.
PetroYuan with Saudi and other gulf countries is a very sensitive and delicate move. The gulf countries need security guarantees from China and Russia so the US won't play another "Arab spring or revolution". Saudi joining SCO is such guarantee.
Other thing to consider in terms of Digital/Financial Silk Road is the influence of digital currencies. I've looked at it for a while and it seems to me most of the promises reside in mobile payment app. This allows people to get around government control.
For example, in this alarmist article, certain experts sound alarm at the idea that it's harder to investigate trails through Chinese mobile payment system than crypto.
And it's alarming to certain people because Alipay is the most popular mobile payment system in the world for 10 years in a row.
WeChat pay is next. Notice their advantage over apple/google pay. This is one area where Chinese tech firms got a head start over American tech firms and can set the industry trend.
and with examples like this, they continue to expand abroad to more countries
but they did find working with incumbents to be easier than building market by themselves. Which is how Alipay+ started. This is quite interesting.
In the past 2 years, they really put effort in taking this Alipay+ idea into more places. Again, it seems to me that their main competitor here is Apple/Google pay. The winners here will control future of e-commerce.
like in this one, notice how adding more JV partners to Alipay+ platform encourages other countries to accept Alipay+. It benefits all the JV partners, but really benefits Alibaba here.
It's kind of interesting to read about this. Alipay is very much bringing technology, merchants and scale here while the Indonesia player Akulaku is bringing customer base.
There are many similar articles about Alipay+ adding partners. In general, being first mover helps. Having scale helps. Having large customer base helps. It's kind of like with Amazon, the larger it got, the easier it was to dominate/corner the market.
If we give Alibaba another 5 years, they could dominate the e-commerce infrastructure around the world with AliExpress/Lazada and the mobile payment infrastructure around the world with Alipay+.
For example, in this alarmist article, certain experts sound alarm at the idea that it's harder to investigate trails through Chinese mobile payment system than crypto.
And it's alarming to certain people because Alipay is the most popular mobile payment system in the world for 10 years in a row.
WeChat pay is next. Notice their advantage over apple/google pay. This is one area where Chinese tech firms got a head start over American tech firms and can set the industry trend.
and with examples like this, they continue to expand abroad to more countries
but they did find working with incumbents to be easier than building market by themselves. Which is how Alipay+ started. This is quite interesting.
In the past 2 years, they really put effort in taking this Alipay+ idea into more places. Again, it seems to me that their main competitor here is Apple/Google pay. The winners here will control future of e-commerce.
like in this one, notice how adding more JV partners to Alipay+ platform encourages other countries to accept Alipay+. It benefits all the JV partners, but really benefits Alibaba here.
It's kind of interesting to read about this. Alipay is very much bringing technology, merchants and scale here while the Indonesia player Akulaku is bringing customer base.
There are many similar articles about Alipay+ adding partners. In general, being first mover helps. Having scale helps. Having large customer base helps. It's kind of like with Amazon, the larger it got, the easier it was to dominate/corner the market.
If we give Alibaba another 5 years, they could dominate the e-commerce infrastructure around the world with AliExpress/Lazada and the mobile payment infrastructure around the world with Alipay+.
broadsword
Brigadier
good article about China's covert effort to push forward Yuan. I mean, Russia has been pushing usage of Yuan very locally. We also know from above that CIPS and Yuan settlement is happening with over half of the trading between China and ASEAN countries. But there are more here.
They signed RMB liquidity agreement with 5 central banks. The one that stands out is Chile. Maybe that's their way of bringing south America into fold of using RMB like what they are doing with Mauritius in Africa.
I also did not realize they already have currency swap agreement with Turkey and Armenia. These are all important countries in the silk road to Europe. The missing one here is Turkmenistan.
This part is important. Slowly trying to incorporate more countries into this to pay in Yuan.
I'm still waiting for this to happen. First step is to start trading with SCO countries in Yuan like they are already doing with ASEAN countries.
They signed RMB liquidity agreement with 5 central banks. The one that stands out is Chile. Maybe that's their way of bringing south America into fold of using RMB like what they are doing with Mauritius in Africa.
I also did not realize they already have currency swap agreement with Turkey and Armenia. These are all important countries in the silk road to Europe. The missing one here is Turkmenistan.
This part is important. Slowly trying to incorporate more countries into this to pay in Yuan.
I'm still waiting for this to happen. First step is to start trading with SCO countries in Yuan like they are already doing with ASEAN countries.
