The SCO’s Digital Transformation: Strategic Intentions and Structural Realities

The Shanghai Cooperation Organization (SCO) has entered a critical phase in its digital transformation agenda. Over the past five years, the bloc has increasingly integrated digitalization into virtually every aspect of its operations—ranging from e-governance and cross-border trade to cybersecurity, infrastructure development, and artificial intelligence. But as the SCO shifts from statements to implementation, it confronts a complex landscape defined by technological asymmetries, competing sovereignties, and external geopolitical pressures.

The Strategic Context: Digitalization as a Geopolitical Priority
The political leadership of SCO member states has made digital transformation a top strategic priority. In particular, the organization has embedded digitalization into its long-term development plans and institutional architecture. This is reflected in key programmatic documents, including the 2020 Statement of the SCO Heads of State Council on the Digital Economy, the 2023 Statement on Digital Transformation, and the June 2025 Action Plan on Digital Transformation.
This latest Action Plan systematizes cooperation across seven priority tracks: (1) digital infrastructure and connectivity; (2) cybersecurity and data protection; (3) e-commerce and smart logistics; (4) artificial intelligence and robotics; (5) digital skills and workforce development; (6) regulatory harmonization; and (7) cooperation on digital public goods.
This institutional foundation signals that the SCO no longer sees digital transformation as a sectoral issue but as a framework for regional integration and strategic autonomy in an increasingly bifurcated global tech order.
Drivers of SCO Digitalization: From E-Commerce to Cyber Norms
Several key developments underscore the bloc’s growing orientation toward digital integration.
Firstly, cross-border e-commerce has surged across the region. In 2024, trade via cross-border digital platforms between China and other SCO countries increased by 14 percent, reaching $12.8 billion. Chinese companies like Alibaba and JD.com have expanded operations in Kazakhstan, Uzbekistan, and Pakistan, reinforcing Beijing’s lead in regional platform economies.
Secondly, cybersecurity cooperation has emerged as a key area of joint attention within the SCO. Member states have highlighted the importance of enhancing coordination in such fields as cyber defense, countering disinformation, and developing approaches to data governance. In this regard, Moscow has put forward an initiative to explore a common SCO framework on cyber sovereignty, while other members, including China and the Central Asian countries, have expressed readiness to contribute their own experience and perspectives to building a more secure and trusted digital environment across the region.
Thirdly, the SCO has begun experimenting with regulatory harmonization across member states. In 2023–2025, several pilot projects were launched in the digital customs and logistics sectors, involving China, Kazakhstan, and Uzbekistan. These initiatives aim to streamline cross-border data flows, digital signatures, and mutual recognition of electronic licenses, with the eventual goal of building a “Digital Silk Road” within the SCO.
Structural Challenges: Asymmetries and Fragmentation
Despite visible progress, the SCO faces four structural challenges that could limit the depth and scope of digital integration.
Firstly, there exists a profound asymmetry in digital infrastructure and capacity among member states. China maintains a massive lead in mobile internet speed, AI development, and digital public services. In contrast, some countries lag behind significantly in internet access, data centers, and government digital services. This disparity has created a digital hierarchy within the SCO, making equitable cooperation difficult.
Secondly, the bloc suffers from a lack of regulatory harmonization. Each member state operates under distinct legal frameworks for data protection, cybersecurity, and digital trade. While China promotes a model of “cyber sovereignty,” others such as Kazakhstan and Uzbekistan have adopted hybrid approaches—balancing state oversight with market openness. These divergences hinder the interoperability of digital systems and the scalability of joint projects.
Thirdly, digital cooperation remains fragmented across bilateral and sub-bloc platforms. For example, China–Central Asia, China–Russia, and Pakistan–Russia tech cooperation often bypass broader SCO mechanisms. Multilateral initiatives struggle to gain traction compared to bilateral arrangements, partly due to varying threat perceptions and overlapping alliances with external partners like the EU, United States, or Gulf countries.
Fourthly, political trust and data governance remain unresolved. Several member states view the dominance of Chinese digital platforms and Russia’s cybersecurity agenda with caution. Concerns over surveillance, data localization, and the extraterritorial reach of major tech companies have slowed down deeper integration. While there is broad rhetorical consensus on the need for cooperation, actual interoperability is rare.
Looking Ahead: Can the SCO Become a Digital Bloc?
The future of SCO digital transformation hinges on reconciling two competing imperatives: integration and sovereignty.
On one hand, the organization aspires to build a shared digital ecosystem that supports regional development, facilitates trade, and enhances technological resilience. On the other hand, member states remain deeply protective of their digital sovereignty, wary of overreliance on external technologies or regulatory capture by major powers within the bloc.
To bridge this gap, the SCO could adopt a flexible digital architecture—one that allows for modular cooperation, where willing members can move ahead on specific tracks such as e-commerce, cybersecurity, or digital education without requiring full consensus. Furthermore, the bloc must invest in capacity building in lagging member states, perhaps through a common Digital Development Fund or regional technology transfers.
The creation of a Digital SCO Hub, proposed during the 2025 Digital Economy Forum in Tianjin, could offer a centralized coordination mechanism. Such a platform would streamline digital standards, foster interoperability, and serve as a clearinghouse for pilot projects in AI, logistics, and smart cities.
Conclusion: Between Strategy and Structure
The SCO’s digital transformation strategy is ambitious and timely. It reflects broader shifts in the global order, where regional organizations are stepping in to fill governance gaps left by global institutions. However, ambition alone is not enough. Unless the SCO addresses its structural disparities, enhances regulatory coherence, and builds greater unity among its members, its digital agenda risks becoming another declaratory framework with limited strategic value.
As the digital frontier becomes the new battleground for influence, the SCO must decide whether it wants to be a forum of loosely connected sovereigns or an integrated bloc capable of shaping regional digital order. The next five years will likely determine which path prevails.

Ozod Tanbaev,
Research Fellow at the International Institute for Central Asia