The 2025 Shanghai Cooperation Organization (SCO) Digital Economy Forum, held in Tianjin on July 11, offered rare policy clarity on how SCO member states are positioning themselves for a more integrated digital future—centered on data governance, secure infrastructure, and cross-border innovation.

Bringing together over 1,500 participants from governments, enterprises, academic institutions, and think tanks across the SCO region, the event highlighted a growing consensus around data sovereignty, cross-border data flows, and the co-development of digital public goods. As global tech governance becomes increasingly fragmented, the SCO is positioning itself as a bloc seeking regulatory interoperability, particularly between China, Central Asia, South Asia, and parts of Eastern Europe.

At the opening session, Liu Liehong, head of China's National Data Administration, emphasized that member states had made “substantive progress” in building digital infrastructure and transforming legacy industries through joint platforms. These collaborative projects, he noted, are already “injecting new momentum into regional development” through a shared commitment to innovation.

Toward a Shared Digital Framework

Themed “New Bonds in the Digital Economy, New Horizons for Cooperation,”the forum featured expert sessions on industrial digitalization, talent development, and data-driven ecosystems. One of the most significant outcomes was the launch of the SCO Digital Economy Think Tank Alliance, accompanied by a joint initiative that calls for deeper alignment on data policy, digital standards, and technology deployment.

At the heart of the forum was a dedicated think tank sessiontitled “Data Governance and Ecosystem Co-Building,”which drew representatives from nearly all SCO nations. Chinese and international scholars openly discussed complex topics such as data localization vs. interoperability, the role of artificial intelligence in national productivity strategies, and how to balance innovation with cybersecurity.

Chen Ronghui, Vice Minister of the National Data Administration, called for “soft connectivity” in rules and norms to bridge regulatory gaps across member states. He urged delegates to focus on actionable frameworks, especially in frontier areas like AI governance, cross-border algorithmic accountability, and platform interoperability.

Perspectives from the Region

During the keynote segment, Muhammed Bozkurt, a former lead negotiator at Turkey's Ministry of Trade and now senior researcher at the Asia-Pacific Research Center, stressed that fragmented global data governance is an emerging risk. He called for the creation of a global digital compactrooted in trade frameworks, to ensure trust in digital systems and prevent governance silos from stalling cross-border growth.

From Russia, Pavel Kuznetsov, Deputy Director of the Chinese and Contemporary Asia Studies Institute at the Russian Academy of Sciences, emphasized the importance of digital sovereignty and regional standards. He proposed joint development of digital ecosystems, including e-commerce protocols, customs blockchain protection, and even pan-SCO digital research laboratories to cultivate AI literacy and network security skills among students.

China's own academic voices also focused on industrial relevance. Shiyong Shi, a senior advisor to China's State Council and director of the Chinese Academy of Sciences'Virtual Economy and Data Science Center, unpacked how AI and large models are redefining productive capacity. He argued that digital transformation should center on the “three pillars” of the digital economy: big data, intelligent algorithms, and computing infrastructure.

Other contributions highlighted granular but practical innovations. Alexey Mikhailov, Chief Researcher at the Russian Academy's Center for Strategic Political Analysis, presented research on synthetic data and algorithm optimization in the Chinese market. Alimnazar Islamkulov, Vice President of Tashkent State University of Economics, discussed how digitalization is shaping regional economic development and creating pathways for more inclusive growth.

Business representatives brought a ground-level view:

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JD Grouppresented on managing large-model AI deployment through responsible governance.

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360 Technology Groupspoke on open innovation in security architecture.

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China Unicom Logisticsoutlined how data assets can reduce logistics costs across society.

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The National Supercomputing Center in Tianjinhighlighted computational cooperation as a backbone for AI applications across borders.

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The Roundtable Dialogue, titled “Globalizing Data Governance: Building Bridges, Not Walls,”featured voices from Kazakhstan, Mongolia, India, and Pakistan. Panelists shared their countries' respective strategies on digital transformation, while exploring the integration of national frameworks into Belt and Road digital corridors.

Implications for International Investors and Advisors

While the forum did not result in formal treaty-level agreements, its real value lies in the architecture of dialogue it unveiled. For foreign law firms, cross-border digital service providers, and investment consultants, the SCO's emphasis on regulatory harmonization and digital sovereignty opens a niche but growing field: advising clients on how to operate across a region where digital rules are still in flux, but increasingly cooperative.

The discussions also hint at emerging alignment opportunities for international IT and infrastructure providers, particularly in areas like secure data platforms, AI training, cloud computing localization, and cybersecurity services tailored for sovereign frameworks.

Unlike Western-centric digital compacts, SCO digital cooperation is rooted in multilateral pragmatismrather than a rules-first approach. The focus is less on convergence and more on interoperability without sacrificing national control—a posture that may appeal to multinationals seeking regulatory clarity without full alignment.

For institutions tracking geopolitical digital bifurcation, this forum provided a case study in middle-power digital diplomacy. Countries like Pakistan, Russia, and Uzbekistan are actively exploring how to maintain open digital corridors with China, while resisting a polarized internet governed by competing global standards.

A Forum, Not a Finish Line

The Tianjin forum reaffirmed that the SCO is not merely a geopolitical bloc—it is evolving into a regional coordination mechanism for digital transformation. From shared AI ethics to technical infrastructure cooperation, the path ahead will likely be gradual and uneven. But for global firms with operations across SCO jurisdictions, the signal is clear: regional digital integration is no longer theoretical—it's in motion.