How the SCO chips away at US power without an alliance system

The Shanghai Cooperation Organisation (SCO) was born 25 years ago as a modest mechanism for managing borders between China, Russia and four Central Asian states. At its anniversary summit in Bishkek this week, it looks more consequential – and harder for the United States to dismiss.
The timing is important. Russia’s invasion of Ukraine remains unresolved, while the war between Iran and the US has turned the Persian Gulf into another theatre of strategic competition, with energy markets again exposed to disruption around the Strait of Hormuz. The SCO now brings together China, Russia, India, Iran, Pakistan, most of the Central Asian republics and Belarus, alongside partners including Turkey and multiple Gulf states.
Its 10 full members represent more than 3.4 billion people and roughly a quarter of global GDP. However, its growing importance is not simply a matter of size.
President Xi Jinping has called for the SCO to assume a larger role in technology and security and to help create a “universally secure environment”. He has presented it as a model of cooperation without formal alliances, confrontation or targeting third parties, urging members to focus on development, security, people’s well-being and dialogue.
Calling the SCO an anti-American alliance is a mistake. Its members have different interests. India and China remain strategic competitors; India and Pakistan have long-standing tensions; and Central Asian governments want room to manoeuvre between Moscow, Beijing, Ankara, Brussels and Washington. Turkey remains a North Atlantic Treaty Organization (Nato) member while pursuing a larger Eurasian role.
The SCO has neither Nato’s military command nor the European Union’s supranational institutions. Its significance is more practical: it gives states that do not want their foreign policy defined in Washington a forum to coordinate, negotiate and hedge.

Rather than creating a coherent rival bloc, the SCO is helping normalise a world in which Washington is no longer the indispensable venue for every major geopolitical discussion.
Xi’s language reflects that ambition. By stressing cooperation without alliance or confrontation, Beijing is offering the SCO as an alternative model of international organisation. Whether that model is as inclusive as advertised is debatable, but its appeal is growing.
The organisation’s agenda has expanded beyond its original security mission. Trade, energy, transport, technology and finance now sit alongside counterterrorism and regional security.
Technology could prove especially important. Xi wants the SCO to play a larger role in technology and security, reflecting a broader shift in the sources of geopolitical power. Digital infrastructure, artificial intelligence, data and technology standards increasingly shape national security as much as conventional military capabilities.
SCO members have discussed greater use of national currencies, financial cooperation and new development mechanisms, including an SCO development bank. None threatens the US dollar’s central position today, but Western sanctions and restrictions on access to financial infrastructure are encouraging some countries to develop alternative channels for trade and payments.
The wars are reinforcing that trend. Russia has become more dependent on Asian markets, while its energy ties with China remain substantial. Beijing was still buying about 2 million barrels a day of Russian crude in 2025. The war in Ukraine has underscored the value of continental energy supplies and transport routes that reduce China’s exposure to maritime chokepoints.

Beijing does not need the SCO to become a military alliance. The organisation gives China a platform for expanding economic connectivity and political influence without obliging it to provide security guarantees to every member.
Washington should take the SCO seriously. A strategy built too heavily around tariffs, technology restrictions and pressure on third countries to choose sides can encourage exactly the hedging that makes institutions such as the SCO more valuable. Economic pressure has its uses, but sustained pressure also gives other countries reasons to seek alternative suppliers, markets, technologies and payment systems.
The US has legitimate interests in Ukraine, the Middle East, freedom of navigation, technology security and the dollar-based financial system, but Washington needs to distinguish between adversaries and institutions.
The SCO’s 25th anniversary shows that Eurasian states are building cooperation mechanisms that can survive disagreements among members. While Washington cannot stop that evolution, it can decide how to respond. That means working with Central Asian states where interests overlap; maintaining strong channels with India and Turkey; competing with China without treating every Chinese initiative as hostile; protecting technological advantages without accelerating parallel systems; and keeping diplomatic contacts open with governments whose cooperation could become important on energy, terrorism, proliferation and conflict.
The SCO is unlikely to become the Eurasian equivalent of Nato. Its importance is that it is becoming part of the infrastructure of a more fragmented international system where power is distributed more widely and middle powers have more choices. The question for Washington is whether it is prepared for a world in which it is no longer the country around which everyone else must organise.