Impact of Trade Facilitation Measures on Textile Sector Export Performance in Pakistan

Abstract

This study analyses the impact of trade facilitation measures taken by the Government of Pakistan at various stages of time on export performance of Pakistan. As a case study, Textile Sector of Pakistan has been taken into consideration to evaluate the impact of trade facilitation measures taken so far by the Government of Pakistan. By using Export Supply Function, the study benchmark itself on being the first of its kind to analyze trade facilitation framework using Macro Economic approach. Estimation technique used in this research was FMOLS technique where data of textile exports from 1984 to 2015 was analyzed to draw interesting insights regarding the journey of Trade Facilitation and its impact on textile exports of Pakistan. Impact of trade facilitation indicators were captured by introducing dummy variables into the theoretical framework. In order for more comprehensive results, Textile Categories of codes 26, 65 and 84 exports were analyzed to reinforce empirical findings. The results of the study share some thought-provoking results regarding effect of trade facilitation measures on export performance of Pakistan. 6 major indicators of Trade Facilitation were defined in this research with majority indicators showing significant and positive results. There were few exceptions where sign of few trade facilitation indicators were negative and significant indicating that some of the trade facilitation indicators didn’t have the desired impact on facilitating exports engaged in textile exports specifically.