The Impact Of China’s SPS And TBT Measures On Pakistan’s Exports To China:An Empirical Analysis Employing PPML Approach

China and Pakistan are not only both WTO members,but also "Iron friends".In consideration of China’s gigantic growth in trade,especially the promising impact of the Belt and Road Initiative,and China-Pakistani FTA on Pakistan,Pakistan has potential to export more to China for economic growth.Unfortunately,Pakistan has remained at a large deficit with China.Now it is of practical importance to evaluate the impact of China’s nontariff measures on Pakistan’s export and provide evidence for policy-makers in how to enhance trade.To accomplish this end,the present study is structured as follows.The first section Introduction presents the background and argues for why this inquiry is chosen and research significance,followed by an introduction to research design and its originality and limitations.The second section Literature Review outlines the current research status,with an aim to present a research niche and theoretical foundation for the thesis design.Four perspectives are presented and discussed;they are the influence of non-tariff measures on trade flow,coverage ratio is used in measuring non-tariff measures,and gravity model estimates of international trade,together with trade policy by China and Pakistan.Third section is a statistical analysis of Pakistan’s export to China,where the status quo between China and Pakistan trade is depicted,and possible reasons behind Pakistan’s long-standing deficit from the perspective of the impact of non-tariff measures are given.The fourth section Research Methodology mainly introduces model setup,sources of data,and variables,followed by procedures of how to conduct the research.The fifth section Empirical Study,covers summary statistics,correlation analysis,endogeneity test,ordinary least squares,fixed effects model and Hausman test.This research employs Poisson pseudo maximum likelihood(PPML)approach and an adapted version of the gravity model,utilizing a panel dataset of 20 product categories from 2008 to 2019 to estimate the impacts of SPS and TBT measures on exports of Pakistan to China.As evidenced,there exists a significant relationship between TBT and SPS measures with Pakistani exports to China.SPS measures are negatively significant,whereas TBT measures are positively significant.It is observed that Internet has no influence on Pakistan’s exports to China,maybe because Pakistan relies on agricultural exports.The sixth section concludes with suggestions on what to do next for Pakistan to improving its export to China.