Exploring Pakistan’s Regional Economic Cooperation Potential
AbstractFree trade benefits are not well-harnessed despite the WTO because of the regional groupings. Such groupings have, in fact, resulted in a chaos. Pakistan has been a member of the SAARC and the ECO. In both the groups, intra-regional trade accounts for only four percent of total trade. The present study briefly reviews and identifies constraints to intra-regional trade and other modes of economic cooperation in the region. The SAFTA agreement and the possibilities of greater economic cooperation are also examined. Comparative advantage and low trade complementarity are found to be the main impediments to trade. Other obstacles such as limited capacity to generate exportable surpluses, restrictive trade policies, and political problems have also inhibited the growth of intra-regional trade. Higher trade levels can be achieved through intra-industry trade, vertical specialisation, joint export marketing of competing regional export products, deepening trade liberalisation, promoting monetary cooperation, and encouraging joint industrial ventures. It is imperative for the success of SAFTA that the negative list is kept quite small and the countries are prepared for closure of a few industries. Thus the SAFTA has great potential and South Asian countries should accept short-term costs for long-run benefits. Expansion of trade as well as efficiency and improved quality of exports would benefit the countries participating in the regional co-operation effort.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.
Volume (Year): 43 (2004)
Issue (Month): 4 ()
Pakistan; Regional Economic;
Find related papers by JEL classification:
- R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Haaland, Jan I. & Norman, Victor D, 1992. "Global Production Effects of European Integration," CEPR Discussion Papers 669, C.E.P.R. Discussion Papers.
- Bhagwati, Jagdish N, 1971. "Trade-Diverting Customs Unions and Welfare Improvement: a Clarification," Economic Journal, Royal Economic Society, vol. 81(323), pages 580-87, September.
- Levy, Philip I, 1997. "A Political-Economic Analysis of Free-Trade Agreements," American Economic Review, American Economic Association, vol. 87(4), pages 506-19, September.
- Paul Krugman, 1991.
"The move toward free trade zones,"
Proceedings - Economic Policy Symposium - Jackson Hole,
Federal Reserve Bank of Kansas City, pages 7-58.
- Jeffrey A. Frankel and Shang-Jin Wei., 1995. "European Integration and the Regionalization of World Trade and Currencies: The Economics and the Politics," Center for International and Development Economics Research (CIDER) Working Papers C95-053, University of California at Berkeley.
- Jeffrey A. Frankel, 1997. "Regional Trading Blocs in the World Economic System," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 72.
- Srinivasan, T-N, 1996.
"The Common External Tariff of a Customs Union : Alternative Approaches,"
755, Yale - Economic Growth Center.
- Srinivasan, T. N., 1997. "The common external tariff of a customs union: Alternative approaches," Japan and the World Economy, Elsevier, vol. 9(4), pages 447-465, December.
- Lawrence H. Summers, 1991. "Regionalism and the world trading system," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 295-301.
- Drusilla K. Brown & Robert M. Stern, 1989.
"U.S.-Canada Bilateral Tariff Elimination: The Role of Product Differentiation and Market Structure,"
in: Trade Policies for International Competitiveness, pages 217-254
National Bureau of Economic Research, Inc.
- Brown, D.K. & Stern, R.M., 1988. "U.S.-Canada Bilateral Tariff Elimination: The Role Of Product Differentiation And Market Structure," Working Papers 227, Research Seminar in International Economics, University of Michigan.
- George, Robert & Reiling, Eldon & Scaperlanda, Anthony, 1977. "Short-Run Trade Effects of the LAFTA," Kyklos, Wiley Blackwell, vol. 30(4), pages 618-36.
- Kimberly A. Clausing, 2001. "Trade creation and trade diversion in the Canada - United States Free Trade Agreement," Canadian Journal of Economics, Canadian Economics Association, vol. 34(3), pages 677-696, August.
- Vamvakidis, Athanasios, 1998. "Regional Integration and Economic Growth," World Bank Economic Review, World Bank Group, vol. 12(2), pages 251-70, May.
- Aitken, Norman D, 1973. "The Effect of the EEC and EFTA on European Trade: A Temporal Cross-Section Analysis," American Economic Review, American Economic Association, vol. 63(5), pages 881-92, December.
- Kemp, Murray C. & Wan, Henry Jr., 1976. "An elementary proposition concerning the formation of customs unions," Journal of International Economics, Elsevier, vol. 6(1), pages 95-97, February.
- Shahbaz, Muhammad & Leitão, Nuno Carlos, 2011. "Intra-industry trade: The Pakistan experience," MPRA Paper 28665, University Library of Munich, Germany.
- Muhammad Shahbaz & Nuno Carlos Leitão & Muhammad Sabihuddin Butt, 2012. "Pakistan Intra-Industry Trade: A Panel Data Approach," International Journal of Economics and Financial Issues, Econjournals, vol. 2(2), pages 225-232.
- Khadan, Jeetendra & Hosein, Roger, 2013. "New Empirical Insights into the “Natural Trading Partner” Hypothesis for CARICOM Countries," MPRA Paper 50493, University Library of Munich, Germany.
- Khadan, Jeetendra & Hosein, Roger, 2014. "Trade, Economic and Welfare impacts of the CARICOM-Canada Free Trade Agreement," MPRA Paper 54836, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Khurram Iqbal).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.