Emerging Global Trading Environment: Challenges for Pakistan

Abstract

This paper attempts to identify the opportunities opened up by the Uruguay Agreement, costs imposed by it, and the manner in which growing regionalism and interface of trade with labor and environmental standards are expected to influence Pakistan’s trade prospects. This paper also suggests response strategies so that Pakistan can maximize gains or minimize the damage from the changes contemplated in the Agreement. Pakistan’s exports are likely to receive significant tariff and nontariff reduction in their destination. However, market access will only materialize if domestic producers observe standardization and quality control. The GATS provides an opportunity to increase economic efficiency of its services sector. Liberalization of investment regime under TRIMS Agreement is expected to attract foreign direct investment. To satisfy the requirements of the TRIPS Accord, Pakistan will have to make significant changes in its legislation on intellectual property rights. In the midst of growing regionalism, Pakistan’s policy response should be to strengthen regional blocs in its neighborhood (SAARC and ECO). Finally, to satisfy controversial labor and environmental requirements, Pakistan needs a strict compliance to ILO Conventions and international environmental standards.