This research study attempts to explore the effect of a trade war between the United States of America and China on Pakistan and other regional countries exports to the United States of America. The difference-in-difference methodology used to obtain the coefficients of each country to estimate the change in exports to the US from China, India, Bangladesh, and Pakistan. The empirical results indicate that due to the imposition of US tariffs, China’s exports to the US reduced by 39%, whereas Pakistan’s exports to the US lowered by 3%. India and Bangladesh, on the other hand, gains from the trade war with India’s exports increased by 39% and Bangladesh’s exports increased by 50%. Therefore, it can conclude that the US-China trade war does not bring positivity to overall Pakistan’s trade position.
1-Zulfiqar Ali Keeryo Ex. Economic Growth Advisor, Research and Training Wing, Planning and Development Department, Government of Sindh, Pakistan.2-Jazib Mumtaz PhD Scholar, Department of Social Sciences (Economics), Shaheed Zulfikar Ali Bhutto Institute of Science and Technology, Karachi, Sindh, Pakistan.3-Allah Bux Lakhan PhD Scholar, Department of Economics, Shah Abdul Latif University, Khairpur, Sindh, Pakistan.
Trade War, Trade Diversion, Tariffs, United States, China, Pakistan