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标题: THE IMPACT OF TECHNICAL BARRIER TO TRADE ON PAKISTAN TEXTILE 作者: Shah M.

期刊: Pakistan Journal of Science, 卷: 66；期: 2；页:130-137； 年份: 2014

THE IMPACT OF TECHNICAL BARRIER TO TRADE ON PAKISTAN TEXTILE

INDUSTRY

ABSTRACT: During the last three decades, trade barriers have been drastically reduced under obligations of WTO. Due to freedom in trade, competition has increased, forcing industries to improve their productivity to compete in this free market. However there are still some trade barriers which are used to block market access. Technical Barrier to Trade (TBT) is one of such barriers. In this study the impact of TBT on export performance of Pakistan textile industry has been empirically evaluated. A model was framed which represented TBT and export performance as variables. Primary data was collected from top textile firms of Pakistan. Multiple regression analysis was applied on the primary data. Results indicated that TBT has positively affected the performance of Pakistan textile industry.

Keywords: WTO, TBT, export performance, textile industry, Pakistan. INTRODUCTION

Trade liberalization is considered as catalyst which stimulates economic activity in a progressive economy. It opens up market economy to flourish and prosper. In poor countries, trade liberalization improves the economy and helps reduce poverty (Dollar and Kraay, 2001, World Bank Report, 1987). Contrary to this, there are studies which indicate that there is not enough evidence to support relationship between economic growth and trade liberalization (Grossman and Helpman, 1991, Rodriguez, and Rodrik, 2000).

The conviction that an outward looking trade policy is better than an inward-looking

or shelter view^ias been enthusiastically discussed in the economic enhancement literature(Krueger, 1978, Dollar, 1992, Sachs and Warner, 1995). Whereas the belief that exports are good for economic development is well established, but the ways to export production have been challenged in the trade and industry literature. The experience of East Asian countries has revealed that the route to export production is certainly via import substitution (Amsden, 1989, Wade, 1990), Ocampo and Taylor, 1998).

During 1990-2005, trade liberalization was an obligation for Pakistan. This opening of trade was largely enforced by the IMF and World Bank during structural adjustment srogram (Kardar, 1997).Pakistan is a developing economy and her major source of revenue is from services and agriculture. The contribution of production, construction, retail trade services and wholesale, in Pakistan's GDP, has gone down gradually (Weisbrot and Baker, 2002).

Textile forms60% of Pakistan's total exports. It has faced market access challenges due to discriminating trade barriers by developed countries. For developing countries, main hindrance to market access is non tariff measures (NTM) which include TBT. Open trade is supposed to help greater market access by reducing negative market indicators and boosting productivity in the local market and fair distribution of resources. Pakistan has gradually shifted its exports from raw to finished products (Pakistan Economic Survey, 2001). However in case of textile, Pakistan can not appreciably shift its products from primary goods to finished commodities due to low market access because of presence of NTM.

In this study, author has analyzed the impact of TBT, which is part of NTM, on productivity of Pakistan textile industry.

The research question developed on the basis of arguments in previous section is as follows:

How much and to what extent have the trade barriers as TBT, influenced export performance and the productivity of textile industry of Pakistan, during the period 1990 to 2005?

The purpose of the study was to evaluate empirically the impact of TBT on the export

performance and productivity of textile Industry of Pakistan.

This study is beneficial for the policy makers of the Government of Pakistan, textile firms operating in Pakistan, research scholars, research organizations, universities as well as foreign research organizations who want to enhance their understanding regarding effects of trade barriers on the textile industry of Pakistan.

TBT refers to different measures which countries use to control the markets, defend their consumers and protect natural resources. However, it may additionally discriminate against imports in favor of domestic products (Geoffrey, 1997). There is persistent fear among small developing countries about the rate at which new and possibly more complex standards and regulations are being introduced into the global markets (Broberg, 2009).

Market-driven voluntary standards usually do not threat market access, but failure to observe these standards or technical rules in different national and international laws will result in refusal of merchandise at points of entry by the customs. A certain commodity can sustain positive and negative impacts by standards and regulations through labeling and packaging laws, the food safety rules and the inspection and certification rules. Those countries which are allowed a duty-free access to the European market, cannot guarantee their permanent presence in this market, as they can be blocked by some technical requirements. TBTs result in enhanced cost for exporter in market access. Even inside the European Union, around 10% of overall expenditure falls on merchandise from different European Union countries.

Local regulations and standards can present multiple barriers to trade depending upon their aim and also the structural amendments and behavioral responses. MATERIALS AND METHODS

In this study, author formulated a mathematical research model to represent association of TBT with the export performance of the textile industry of Pakistan. Primary data was collected by means of a structured questionnaire. Author developed a questionnaire that comprised of questions which were adopted from the research studies of (Pricewaterhouse, 2001, MAIA and IFM, 2004).Questionnaire included two parts. First part asked respondents questions about demographics of the firm and