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GTAP Resources: Resource Display

GTAP Resource #4859

"Pakistan’s Entry into the Proposed Regional Comprehensive Economic Partnership (RCEP) - A CGE Approach"
by Khan, Muhammad Aamir, Naseeb Zada, Terrie Walmsley and Kakali Mukhopadhyay


Abstract
Given the importance of international trade in economic development, this study evaluates the potential impacts of Pakistan’s proposed entry into the ‘Regional Comprehensive Economic Partnership’ (RCEP) using the global Computable General Equilibrium (CGE) model. The study attempts two simulation exercises. The first one includes business as usual implementation of proposed RCEP with full trade liberalization among the RCEP countries. The second simulation investigates the inclusion of Pakistan in the proposed RCEP.

Results obtained are sufficiently different across the two experiments associated with two alternative forms of RCEP, particularly for Pakistan. The impact of RCEP on real GDP of Pakistan is negative under the first experiment and positive under the second experiment. However, the impact on real GDP of other RCEP member economies is positive under both the simulations with a higher increase under the second experiment as compared to the first simulation. It indicates that Pakistan’s entry into RCEP is expected to yield region-wide gains. On the other hand, the impact of RCEP on real exports and imports of Pakistan is positive which reflects that Pakistan’s proposed participation with RCEP will boost up regional trade flows and so region-wide gains. Pakistan’s entry into RCEP is also significant for the ASEAN region as it can reduce the distance to the Central Asian economies which is one of the main exports destined regions of RCEP exports. The recent example is the Pak-China economic corridor. It will potentially reduce the regional trade costs and so its entry into the RCEP is expected to reduce the trade costs in the region. This study suggests Government policy makers to negotiate Pakistan’s entry into the RCEP group with the member economies.


Resource Details (Export Citation) GTAP Keywords
Category: Other CGE Application
Status: Not published
By/In:
Date: 2016
Version:
Created: Khan, M. (1/10/2016)
Updated: Khan, M. (12/9/2019)
Visits: 2,589
- Multilateral trade negotiations
- Preferential trading arrangements
- The GTAP Data Base and extensions
- Asia (East)
- Asia (South-Central)
- Asia (Southeast)


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