Second in a three-part series.

Member states of the Economic Cooperation Organization (ECO) have declared their intention to make improvements in the regional transportation and communications infrastructure, aiming to stimulate economic development. A 10-year improvement plan is in place, but implementation of the 12-point project remains in doubt due in part to political and social instability.

ECO comprises 10 member states, including Afghanistan, Azerbaijan, Iran, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, Turkey, Turkmenistan and Uzbekistan. The group has established an administrative apparatus to promote development. Nevertheless, trade among members has lagged since 1992, when the group expanded from its original three members – Iran, Pakistan and Turkey – to include the former Soviet republics in Central Asia and the Caucasus. [Click here for Part I of the series on ECO].

An inadequate regional transport infrastructure has been identified as a major obstacle to trade. Current links among the members are poor, and even existing networks are in disrepair. For example, as much as 60 percent of the road and bridge system in war-ravaged Afghanistan is in need of replacement. Many observers say ECO is unlikely to thrive until a comprehensive infrastructure is in place.

ECO's vision for the development of transport and communications networks was first outlined in Ashgabat Declaration of 1997, which called for the formation of a permanent commission to oversee infrastructure improvements. The document called for the creation of a network of roads, railways and ports that would make ECO goods easily exportable via shipping hubs in Iran, Pakistan and Turkey.

Subsequently, ECO established a program of action that began in 1998 and runs through 2007. The program outlines 12 objectives to stimulate trade and facilitate the movement of goods from landlocked regions to existing ports. Among the program's major objectives are: the construction of a Trans-Asian railway; development of better border customs facilities; the establishment of a common postal area; the development of a Transit Transport Framework Agreement; the creation of an information mechanism to manage inter-state commerce; and the development of an inter-state fiber-optic telecommunications system. Other points in the program call for the publication of studies, along with the convening of regular inter-governmental meetings, aimed at stimulating trade.

In the area of railway development, some progress has been achieved. For example, the Tejen-Seraks-Mashad railway linking Iran and Turkmenistan, inaugurated in 1996, increases the access of Central Asian states to the ports of the Persian Gulf and Arabian Sea, as well as toTurkish ports on the Black Sea and the Mediterranean.

However, other aspects of railway development appear stalled. Under a plan finalized in October 1999, ECO sought to promote rail passenger traffic, the first stage of which would have introduced new service from points in Kazakhstan and Uzbekistan to Iran and Turkey. The new passenger service was due to begin in early January 2001, but several recent developments have dashed hopes for keeping to the original timetable. The most notable impediments are the continuing civil war in Afghanistan and the Islamic insurgency in Central Asia [For additional information see Eurasia Insight]. Financial difficulties are additionally discouraging a broadening of service, as underscored by Kazakhstan's October 18 decision to halt rail traffic from Tajikistan until Dushanbe pays $1.6 million in overdue transit fees.

Similar problems have hampered development of ECO's shipping capabilities. In 2000, two multipurpose cargo vessels, leased by ECO, were operating in the Persian Gulf. ECO also had transport ships plying the Caspian Sea. Despite the shipping venture being ECO's sole profitable project to date, the operation is in danger of being shut down due largely to financial disputes among member states. Some members have yet to fulfill their commitments for contributing to the venture's capitalization fund.

The lack of follow-up by member states has hampered implementation of other aspects of the program of action. For instance, the Transit Transport Framework Agreement was supposed to be operational by 2000. The agreement was formulated at the fifth ECO summit in May 1998. But as of mid-2000, only Azerbaijan and Tajikistan had formally ratified the pact. Similarly, a project to prepare detailed maps of the road networks of ECO member states has not been completed due to Turkey's reluctance to supply needed data.

Another major obstacle to ECO's infrastructure improvement plans is generated by competition from rival economic development organizations. Indeed, many ECO states are at the same time members of other economic blocs, including the nascent GUUAM group (comprising Georgia, Ukraine, Uzbekistan and Moldova) and the Eurasian Economic Union, which includes Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan. [For background, see EurasiaNet Daily Digest]. In addition, Turkey is exploring membership in the European Union. Such overlap, rather than bringing better focus to ECO projects, serves as a debilitating distraction.

Part III will focus on energy cooperation among ECO members.