Special Economic Zones Under China-Pakistan Economic Corridor: Potentials and Challenges

Abstract

As part of its broader strategy for economic growth, poverty alleviation and reduction
in regional disparities, Pakistan has been promoting Special Economic Zones (SEZs) for
long. SEZs currently operating in Pakistan face challenges related to infrastructure,
investment and governance. The establishment of nine SEZs under China-Pakistan
Economic Zone (CPEC) is a promising step towards modern industrialization. However,
their development process remains lagging and falls short of expectations. SEZs under
CPEC hold great promise for Pakistan's economic growth as they offer opportunities for
modern industrial development, increased exports and employment. To this end,
addressing existing impediments by recourse to effective policies and strong
governance is vital. Drawn on Rostow’s model of economic development and using
qualitative research approach, the study follows a cross-sectional temporal dimension
as it focuses on SEZs from a contemporary perspective. This paper discerns several
potentials of SEZs for economic growth as well as the challenges that undermine the
promise of SEZs.