China–Pakistan Economic Corridor (CPEC) development projects and entrepreneurial potential of locals

• Author: Ren Chong,Adnan Pitafi,Shamsa Kanwal,Amna Younis,Abdul Hameed Pitafi,Muhammad Athar Nadeem
• Published date: 01 November 2019
• Date: 01 November 2019
• DOI: http://doi.org/10.1002/pa.1954

ACADEMIC PAPER

China–Pakistan Economic Corridor (CPEC) development

projects and entrepreneurial potential of locals

Shamsa Kanwal

1

|Abdul Hameed Pitafi

2

|Adnan Pitafi

3

|Muhammad Athar Nadeem

4

|

Amna Younis

1

|Ren Chong

1

1

School of Public Affair, University of Science

and Technology of China, Hefei, China

2

School of Information System &

Management, Hefei University of Technology

China, Hefei, China

3

Mehran University Institute of Science,

Technology and Development (MUISTD),

Mehran University of Engineering &

Technology, Jamshoro, Sindh, Pakistan

4

School of Management, University of Science

and Technology of China

Correspondence

Ren Chong, University of Science and

Technology of China, 96 Jinzhai Road, Hefei,

China.

Email: renchong@ustc.edu.cn

This research explores a very important issue arising from the initiation of China–

Pakistan Economic Corridor (CPEC) in Pakistan, as the major impact seems to be

focused towards small businesses and how they will cope in this competitive market

once Chinese businesses enter in the country. According to scholars and officials,

CPEC will generate several business opportunities for the local Pakistani community.

However, studies related to the CPEC project are limited and only focused on the

development of the CPEC project in various aspects alone. The existing study exam-

ined the local entrepreneur's attitude and intention in the context of CPEC using a

sample of 255 survey questionnaires. Structural equation modeling was used to test

the proposed hypotheses. Data were gathered from the existing business community

in Karachi, Pakistan. The results validated most of the hypotheses showing positive

attitude towards entrepreneurs and intention towards CPEC development project.

Specifically, local transportation and accessibility of cities show a significant relation-

ship with a positive attitude. Similarly, the attitude of entrepreneurs also shows a pos-

itive relationship with entrepreneur's intention towards CPEC development projects.

Findings have important theoretical and practical implications for policymakers of

CPEC in creating an overall entrepreneurial ecosystem.

1|INTRODUCTION

Road and transportation play an important role in the development of

business and economic growth of the country (Ali, Mi, Shah, Khan, &

Imran, 2017; Chauvet & Baptiste, 2019). Road and transportation also

help to increase the living standard of the local community, remove

poverty by linking remote areas and individuals with main business

centers and city markets, and also minimize the development gap in

the region (Bhattacharyay, Kawai, & Nag, 2012). Presently, Pakistan

is facing many challenges such as poor economics, energy crisis,

security issues, and poor infrastructure (Shoukat, Ahmad, & Abdullah,

2017). With the development of China‐Pakistan Economic Corridor

(CPEC), Pakistan will be able to control its economic and energy prob-

lems, whereas China increases its presence in South Asia and securing

a future route for import and export (Small, 2015). In this regard, the

CPEC is necessary for both China and Pakistan. CPEC development

will connect Pakistan, China, Afghanistan, and other countries of

Eastern Central Asia through Gwadar port (Haq & Farooq, 2016;

Raza, 2018). It also connects remote areas of Pakistan and provides

several business opportunities for local and foreign investors (Wang,

2017). According to officials, the CPEC projects are a fate changer

for Pakistan, which consists of multiple other projects including

energy, economic projects, education, and infrastructure development

(Kanwal, Chong, & Pitafi, 2018; Khwaja, Saeed, & Urooj, 2018;

Maqsood, 2018). Energy projects will solve the power outages and

blackout problems of the country, increase the economic activities,

and attract foreign investment (Shaikh, Ji, & Fan, 2016). Several

scholars highlighted the benefits of CPEC for Pakistan and China (Ali

et al., 2017; Kanwal, Chong, & Pitafi, 2019; Raza, Mohiuddin, Zaidi,

& Osama, 2018). Specifically, Ali et al. (2017) discussed the local com-

munity benefits related to CPEC in terms of education, income, and

employment opportunities. Kanwal et al. (2019) investigated the local

Received: 26 March 2019 Accepted: 31 March 2019

DOI: 10.1002/pa.1954

J Public Affairs. 2019;19:e1954.

https://doi.org/10.1002/pa.1954

© 2019 John Wiley & Sons, Ltd.

wileyonlinelibrary.com/journal/pa 1of12