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Deep Trade Policy Options for Armenia: The Importance of Services, Trade Facilitation and Standards Liberalization

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  • Jensen, Jesper
  • Tarr, David G.

Abstract

In this paper we develop an innovative 21 sector computable general equilibrium model of Armenia to assess the impact on Armenia of a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU, as well as further regional or multilateral trade policy commitments. We find that a DCFTA with the EU will likely result in substantial gains to Armenia, but we show that the gains derive from the deep aspects of the agreement. In order of importance, the sources of the gains are: (i) trade facilitation and reduction in border costs; (ii) services liberalization; and (iii) standards harmonization. A shallow agreement with the EU that focuses only on preferential tariff liberalization in goods will likely lead to small losses to Armenia primarily due to a loss of productivity from lost varieties of technologies from the Rest of the World region in manufactured products. Additional gains can be expected in the long run from an improvement in the investment climate. We estimate only small gains from a services agreement with the CIS countries, but significant gains from expanding services liberalization multilaterally.

Suggested Citation

  • Jensen, Jesper & Tarr, David G., 2011. "Deep Trade Policy Options for Armenia: The Importance of Services, Trade Facilitation and Standards Liberalization," Conference papers 332083, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332083
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    References listed on IDEAS

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    1. Karplus, Valerie J. & Paltsev, Sergey & Reilly, John M., 2010. "Prospects for plug-in hybrid electric vehicles in the United States and Japan: A general equilibrium analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 44(8), pages 620-641, October.
    2. SERGEY PALTSEV & JOHN M. Reilly & HENRY D. JACOBY & ANGELO C. GURGEL & GILBERT E. METCALF & ANDREI P. SOKOLOV & JENNIFER F. HOLAK, 2008. "Assessment of US GHG cap-and-trade proposals," Climate Policy, Taylor & Francis Journals, vol. 8(4), pages 395-420, July.
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    Cited by:

    1. Miriam Frey & Zoryana Olekseyuk, 2011. "The EU-Ukraine trade liberalization: How much do the costs of tariff elimination matter?," Working Papers 308, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies), revised Feb 2013.
    2. Elisabeth M. Christen & Joseph Francois & Bernard Hoekman, 2012. "CGE Modeling of Market Access in Services," Economics working papers 2012-08, Department of Economics, Johannes Kepler University Linz, Austria.
    3. Edward J. Balistreri & Zoryana Olekseyuk & David G. Tarr, 2017. "Privatisation and the unusual case of Belarusian accession to the WTO," The World Economy, Wiley Blackwell, vol. 40(12), pages 2564-2591, December.
    4. Schürenberg-Frosch, Hannah, 2011. "How to model a child in school? A dynamic macro-simulation study for Tanzania," Conference papers 332068, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Christen, Elisabeth & Francois, Joseph & Hoekman, Bernard, 2013. "Computable General Equilibrium Modeling of Market Access in Services," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1601-1643, Elsevier.
    6. Ana Paula Cusolito & Raed Safadi & Daria Taglioni, 2016. "Inclusive Global Value Chains," World Bank Publications - Books, The World Bank Group, number 24910.
    7. Georges, Patrick & Mérette, Marcel, 2011. "Trade Diversification Away from the U.S. or North American Customs Union? A Review of Canada’s Trade Policy Options," Conference papers 332084, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    8. Tarr, David G., 2013. "Putting Services and Foreign Direct Investment with Endogenous Productivity Effects in Computable General Equilibrium Models," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 303-377, Elsevier.
    9. Edward J. Balistreri & Zoryana Olekseyuk & David G. Tarr, 2017. "Privatisation and the unusual case of Belarusian accession to the WTO," The World Economy, Wiley Blackwell, vol. 40(12), pages 2564-2591, December.
    10. Mushegh Tumasyan & Karine Harutyunyan & Yelena Manukyan & Armen Grigorian, 2013. "EU-Armenia trade liberalization:A poverty and social impact analysis," Working Papers PMMA 2013-15, PEP-PMMA.
    11. repec:zbw:bofitp:2017_002 is not listed on IDEAS
    12. Grigorian, Armen & Harutyunyan, Karine & Tumasyan, Mushegh, 2013. "EU-Armenia trade liberalization: A poverty and social impact analysis," PEP Working Papers 164279, Partnership for Economic Policy (PEP).
    13. Miriam Frey & Zoryana Olekseyuk, 2014. "A general equilibrium evaluation of the fiscal costs of trade liberalization in Ukraine," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(3), pages 505-540, August.
    14. Hannah Schuerenberg-Frosch, 2015. "How to Model a Child in School? A Dynamic Macrosimulation Study for Tanzania," South African Journal of Economics, Economic Society of South Africa, vol. 83(1), pages 117-139, March.
    15. Gómez Plana, Antonio G. & Latorre, María C., 2011. "Multinational firms go away: A CGE analysis of the impact of divestments," Conference papers 332069, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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