Trade Connectivity

July 6, 2022

The economic growth of nation states is linked to their ability to exploit connectivity and interdependencies within strong regional blocs. Contemporary trade theories, focusing on internal and external economies of scale, explain the emergence of global value chains, emphasizing the pivotal role played by intra-industry trade. 

The limited purchasing power of the domestic market is inadequate for the scale advantage required to achieve a high level of productivity in the production of industrial goods. 

Quite aside from being required by WTO rules, trade liberalization will serve to increase trade flows, bring down tariff and non-tariff barriers, and therefore potentially boost productivity and economic growth across the region. It will unambiguously benefit Pakistani consumers, since product prices fall and consumer choice increases with reduced trade barriers.