Economic Cooperation Organization (ECO) is an inter-governmental regional organization encompassing countries from Europe, Caucuses and Central Asia, Middle East and South Asia with more than 460 million inhabitants and over 8 million square kilometers connecting Russia to Persian Gulf and China to Europe. The overall objective of the Organization is the sustainable economic development of its Member States and the Region as a whole.
Established as Regional Cooperation for Development (RCD) in 1964 by Iran, Pakistan and Turkey, the Organization was renamed as “ECO” in 1985.
In 1992 and in the aftermath of collapse of Soviet Union, the Islamic Republic of Afghanistan and six former Soviet Republics, namely, Republic of Azerbaijan, Republic of Kazakhstan, Kyrgyz Republic, Republic of Tajikistan, Turkmenistan and Republic of Uzbekistan also joined the Organization, forming one of the biggest regional blocs in Asia and beyond.
Over the past three decades or so, the ECO Member States have been collaborating to accelerate the pace of regional development through their common endeavors. Besides shared cultural and historic affinities, they have been able to use the existing infrastructural and business links to further fortify their resolve to transfer their hopes and aspirations into a tangible reality.
In March 2017, Heads of States/Government of the Member States in their 13th Summit in Islamabad endorsed “ECO Vision 2025” where main directions of the ECO in the years to come are draw
Trade and Investment sector occupies the foremost important place and is among the core priority areas which can play its crucial role in improving the economies of the Member States in particularly through expansion in the intra and inter regional trade.
High level fora (including Ministerial Meetings on Commerce and Foreign Trade, Ministerial Meetings on Finance and Economy, the Meetings of Heads of Tax Administration, Heads of Central Banks, Heads of Customs Administrations, Heads of Trade Promotion Organizations) make decisions on trade related matters. These decisions determine the direction and scope for ECO cooperation in the areas of trade and investment.
The aggregated world trade of the ten ECO Member States amounted to US$ 626 billion in 2016 as compared with US$ 648 billion in 2015. This is a decrease of 3.39 percent. Both exports and imports have witnessed decline in 2016 as compared to 2015—exports from US$ 285 to US$ 276 billion and imports from US$ 363 billion to US$ 350 billion.
This decline is part of the overall global slow-down in trade. This decline, however, is less pronounced in 2016 as compared to the sharp decline in 2015 (when it decreased from US$ 828 billion in 2014 to US$ 648 billion in 2015, a decline by 21 percent).
Exports comprise 44% of total volume of in trade 2016 and imports make up the remaining 56%. The share of the ECO's trade in the global trade is about 2 percent as against ECO region’s population of 6.2 percent in the world population. Intra-regional trade accounts for 7.64 of the total trade of the ECO member states. Within ECO, the top exporter is Turkey, which accounts for nearly 51 percent of the total exports of the region followed by Kazakhstan, Iran, Pakistan, and Azerbaijan. These four countries make up 94 percent of ECO's total exports.
ECO countries received foreign direct investment (FDI) of about US$ 36.5 in 2016 as compared to US$ 31 billion in 2015, thereby showing an increase of US$ 5.5 billion (an increase of 17%).
The ECO-Vision 2025 was approved earlier this year. The trade-related Expected Outcomes (targets) of the ECO Vision 2025 are contained in Sections 3A and Section 3E (the Economic Growth and Productivity—from xvii to xix). These are reproduced as follows:
i. The ECO Trade Agreement (ECOTA) will be operationalized and the membership of ECOTA will be increased.
ii. The scope of ECOTA will be enhanced from preferential trade to Free trade Agreement.
iii. Non-WTO Member Countries will be assisted in their accession to WTO
iv. Following pending trade related agreements will be operationalized:
a. ECO Agreement on Mutual Administrative Assistance in Customs Matters.
b. ECO Agreement on Joint Promotional Activities.
c. ECO Trade Facilitation Agreement.
d. Regional Agreement on Cooperation in Taxation Matters.
v. ECO Visa Sticker Scheme for businessmen will be operationalized.
vi. ECO Reinsurance Company will be operationalized.
vii. The role of the ECO Bank will be strengthened in the development of ECO economies. The membership of the Bank will be expanded.
viii. Capacity Building Programmes for Trade Promotion Organizations of the Member Countries will be prepared and executed.
ix. Regional trade exhibitions and fairs will be organized.
x. A robust trade financing programme will be launched for enhancing regional trade.”
“3E. Economic Growth and Productivity
xvii. The Agreement on Promotion and Protection of Investment among ECO Member Countries (APPI) will be operationalized and its membership will be increased.
xviii. Legal regimes and mechanisms to enhance investor protection will be improved;
xix. Capacity Building Programmes for Investment Promotion Agencies of the Member Countries will be prepared and executed.