HBL, the largest commercial bank in Pakistan, is the only commercial bank from any SCO country that was invited to participate in the 18th Council Meeting of the SCO Interbank Consortium (SCO-IBC) held on August 23, 2022, in Tashkent, Uzbekistan. Sultan Ali Allana, Chairman of HBL, addressed the gathering in Tashkent, Uzbekistan. As the only commercial bank in this forum and Pakistan’s largest bank, HBL was positioned to play an integral role in the promotion of regional trade, investment, and finance.
The creation of a regional clearing mechanism to promote commerce among SCO member nations is of “utmost necessity,” according to Allana, given the significant changes in regional trade, logistics, and food security. The HBL chairman’s proposal for a regional clearing mechanism was well received by member countries. Details of Chairman Allana’s speech have also been produced in this current issue of Global Village Space Magazine under the title: Chairman HBL Calls for Regional Clearing System to Facilitate Trade.
It is pertinent to mention that HBL received the honor of becoming a partner bank of the SCO-IBC on August 8, 2014, and in 2018, when the 14th annual council meeting of SCO-IBA was held in Beijing, it was granted the status of a member bank. HBL is also the first Pakistani bank, and amongst few from the whole world, that was allowed to open branch operations inside China.
Over the years, HBL has played a unique role in the region, facilitating trade, investment, and finance between SCO member countries, not least in the China-Pakistan Economic Corridor (CPEC). Since the establishment of CPEC in 2013, HBL has formed a dedicated China coverage team comprised of Chinese and Pakistani bankers in Karachi, Lahore, and Islamabad to provide financial services exclusively to Chinese firms. The bank opened a branch in the Gwadar Free Zone in 2016 for Chinese investors and people who were developing factories there.
Priorities of SCO
The SCO is an intergovernmental organization established in June 2001. Since its creation, SCO’s scope and bureaucracy have expanded, thereby making it a multifaceted and multilateral institution. The SCO currently comprises eight member states (China, Uzbekistan, Kazakhstan, Kyrgyzstan, Russia, Pakistan, Tajikistan, and India). Pakistan was formally admitted as a full member of SCO at the 17th Meeting of the Heads of State Council of SCO in Astana, Kazakhstan, on June 9, 2017.
The main goals of the SCO are: strengthening mutual confidence and good-neighborly relations among the member countries; promoting effective cooperation in politics, trade, and economy; science and technology; culture as well as education; energy, transportation, tourism, environmental protection, and other fields; and making joint efforts to maintain and ensure peace, security and stability in the region, moving towards the establishment of a new, democratic, just and rational political and economic international order.
The SCO-IBC was established by the Council of Heads of Government on October 26, 2005, to provide funding and bank services for investment projects sponsored by the governments of the SCO member states. The SCO-IBC Council meets ad hoc upon the consensus of all the parties at least once per year. The Presidency of the Council is carried out on a rotational basis.
The priority areas of cooperation within the SCO-IBC include providing funding for projects that focus on infrastructure, basic industries, high-tech industries, export-oriented sectors, and social projects; issuing and making loans based on the generally accepted international banking practices; organizing pre-export financing to stimulate trade and economic cooperation between the SCO member states and other areas of common interest.
Note: A slightly different version of this article appears in the 2022 September Magazine.