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Assessing Euro-Med Trade Preferences: The Case of Entry Price Reduction

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  • Gomez, Victor D. Martinez

Abstract

The 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.

Suggested Citation

  • Gomez, Victor D. Martinez, 2007. "Assessing Euro-Med Trade Preferences: The Case of Entry Price Reduction," 103rd Seminar, April 23-25, 2007, Barcelona, Spain 9447, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaa103:9447
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    Cited by:

    1. Goetz, Linde & Grethe, Harald, 2007. "The Relevance of the EU Entry Price System for Imports of Fresh Fruits and Vegetables," Working Papers 7114, International Agricultural Trade Research Consortium.
    2. Goetz, Linde & Grethe, Harald, 2008. "How effective is the EU Entry Price System for Fresh Fruits and Vegetables?," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44063, European Association of Agricultural Economists.
    3. Martinez-Gomez, Victor, 2008. "Current preferences of Southern Mediterranean Countries and their erosion after variations of the entry price system," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44157, European Association of Agricultural Economists.

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    Keywords

    International Relations/Trade;

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