Assessing Euro-Med trade preferences: the case of entry price reduction
AbstractThe EU protects some of its fruits and vegetables through the entry price system. This system consists on a two-tiered tariff, with high-priced exports paying an ad valorem tariff, whereas low-priced exports pay also a supplementary specific tariff. The breaking point between high and low export prices is the entry price level decided by the EU, generally the same level for all third countries. In a few cases, some Southern Mediterranean partners of the EU have agreed a reduced entry price for their exports, together with the more common ad valorem tariff reduction. Among the indicators used for gauge the value of preferences, there is no one devoted to this case of reduced entry price, hence we develop a new indicator that allows to split which part of the preferential gains corresponds to the entry price reduction and which part corresponds to the “usual” ad valorem tariff reduction. We apply this methodology to Moroccan clementines trade flows, with two main findings: 1) The entry price reduction ranges up to 39% of the economic value of preferences in some months; 2) Morocco is not maximizing the gains due to this reduction, and could take some trade and policy lessons, mainly trying to better fit to the concession or, if impossible, use it as negotiating capital in future reviews of the agreement.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 1865.
Date of creation: 10 Feb 2007
Date of revision:
Euro-Mediterranean Trade; trade preferences; fruits and vegetables; entry price regime;
Find related papers by JEL classification:
- Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-02-24 (All new papers)
- NEP-EEC-2007-02-24 (European Economics)
- NEP-INT-2007-02-24 (International Trade)
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