Pakistan Institute of Development Economics


CPEC, SEZ (Special Economic Zones) and Entrepreneurial Development Prospects in Pakistan

The emergence of Special Economic Zones (SEZ) with the regime of trade liberalisation around the globe gained importance especially in the developing world to attract foreign direct investment (FDI). There is ample evidence in recent researches that establish a strong link between knowledge spillovers and spatial economic structure. Conventionally there are similar patterns found in international and regional economics that describes the incidence of higher factor mobility within different regions of a country than between countries. The general results of the spatial production function are that the output of a given regions is increases with increase in knowledge and the capital inputs. The study reaches the conclusion that the technology utilisation in Pakistan is not static and it is evolving with the passage of time. In order to make the SEZs successful, the government needs to follow a gradualist approach toward reform, and promote and strengthen the local governments and decision decentralisation. The government must set clearly understandable goals and along with performance benchmarks, scrutinising, and competition not only for private but also for public sector institutions. At the same time it is needed to improve the institutional efficiency and data gathering, processing and dissemination to support research initiatives and policy making.



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