IMPACT OF TRADE AND ECONOMIC AGREEMENTS ON SMALL MEDIUM ENTERPRISES (SMES) OF PAKISTAN IN THE CONTEXT OF CHINA PAKISTAN ECONOMIC CORRIDOR(CPEC)

Abstract

Impact of economic or trade agreements effect the economy of any developing country in a significant way. Many researchers have done their research on different economic corridors to calculate their impact on the economies of developing countries but there is little, or no research done on China Pakistan Economic Corridor specifically targeting the impact of this economic corridor on the SMEs of Pakistan. The aim of the study was to calculate, analyze and understand the impact of China Pakistan Economic Corridor on the SMEs of Pakistan. Data was collected from the SMEs of Rawalpindi and Islamabad. To conduct this study SME growth was taken as dependent variable while Reduction of Tariffs and Non-Tariff Barriers, Demand of Skilled Labor and New Market Opportunities were taken as independent variables. Data was collected by distributing questionnaires in SMEs of Rawalpindi and Islamabad and statistical analysis was carried out by using SPSS. Findings reveal that SMEs owners believe that China Pakistan Economic Corridor will help their businesses to grow and will increase their profitability. Business community also believes that reduction of tariff and non-tariff barriers will further strengthen their business. Study also briefs us that new market opportunities will be created due to China Pakistan Economic Corridor. Findings also enlightens us that Pakistani businessman believes that demand of skilled labor decreases when SMEs grow.