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Trade agreements between developing countries: a case study of Pakistan - Sri Lanka free trade agreement

Saira Ahmed (), Vaqar Ahmed () and Safdar Sohail

MPRA Paper from University Library of Munich, Germany

Abstract: This paper assesses the pre and post Free Trade Agreement (FTA) pattern in bilateral trade between Pakistan and Sri Lanka. Besides the usual direction of trade analysis we also use general and partial equilibrium approaches in order to evaluate the true potential of this FTA. Our results reveal an increase in welfare and efficiency for both countries. However export basket has not changed much since pre-FTA period. This calls for creating awareness about the FTA and putting in place a consultative mechanism with trade community that can identify the manner in which both countries can accrue maximum benefit from the free movement of tradable goods. Similar suggestions follow in our perception survey carried out for this study.

Keywords: Free Trade Agreement; General Equilibrium (search for similar items in EconPapers)
JEL-codes: C68 F15 F17 (search for similar items in EconPapers)
Date: 2010-11
New Economics Papers: this item is included in nep-int
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