Special Economic Zones (SEZs) and Prospects for the Domestic Economy of Pakistan

Karim Khan

MPRA Paper from University Library of Munich, Germany

Abstract: Special Economic Zones (SEZs) is an important aspect of China Pakistan Economic Corridor (CPEC) besides projects with regard to infrastructure, energy, and the development of Gwadar port. SEZs as growth strategy has static and dynamic implications for the host economy. In static sense, they help in promoting investment, employment, trade and economic growth. In dynamic sense, they result in technological upgradation, human resources development, urban development, institutional and economic reforms besides infrastructure development. All of these are essentials for successful industrial development. However, the success clearly depends on the threshold conditions that need to be met in order to reap the potential benefits associated with successful SEZs. In this regard, the organizational structure of the development and operation of SEZs is of primary importance. For instance, the structure that resolves the problems of knowledge and incentives is deemed to produce the desired benefits. Likewise, effective labor policy combined with less dependence on subsidies ensure higher employment and competitive industrial development. Moreover, secure environment, focus on the domestic priorities and close coordination between stakeholders are among the essentials that lead to success in this regard.

Keywords: CPEC; Special Economic Zones; Organizational Structure; the Problems of Incentives and Knowledge; Domestic Priorities; Coordination (search for similar items in EconPapers)
JEL-codes: A10 O25 O4 O43 (search for similar items in EconPapers)
Date: 2019
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