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Trade Liberalization Strategies; What Could South Eastern Europe Learn From Cefta and Bfta?

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  • Antonis Adam
  • James McHugh
  • Theodora Kosma

Abstract

This paper explores the effectiveness of the Central European Free Trade Area (CEFTA) and the Baltic Free Trade Area (BFTA). Estimates from a gravity model and bilateral trade data support the view that both CEFTA and BFTA helped expand regional trade and limit the emergence of a "hub-and-spoke" relationship between the CEECs and the European Union (EU). These empirical conclusions carry some important policy implications for the "second wave" of prospective EU members among Southeastern European Countries (SEECs). The paper argues that the SEECs should reconsider their bilateral approach to trade liberalization and move towards a multilateral free-trade area as exemplified by both the CEFTA and BFTA.

Suggested Citation

  • Antonis Adam & James McHugh & Theodora Kosma, 2003. "Trade Liberalization Strategies; What Could South Eastern Europe Learn From Cefta and Bfta?," IMF Working Papers 03/239, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:03/239
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    References listed on IDEAS

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    Cited by:

    1. Maria Cipollina & Luca Salvatici, 2010. "Reciprocal Trade Agreements in Gravity Models: A Meta-Analysis," Review of International Economics, Wiley Blackwell, vol. 18(1), pages 63-80, February.
    2. Antonis Adam & Thomas Moutos, 2005. "Turkish Delight for Some, Cold Turkey for Others?: The Effects of the EU-Turkey Customs Union," CESifo Working Paper Series 1550, CESifo Group Munich.
    3. Nargiza Zufarova, 2010. "Eu Regional Trade Vulnerabilities, Liberalization And Potential Lessons For Uzbekistan Trade Reforms," Perspectives of Innovation in Economics and Business (PIEB), Prague Development Center, vol. 6(3), pages 71-74, October.
    4. World Bank, 2004. "Serbia and Montenegro : An Agenda for Economic Growth and Employment," World Bank Other Operational Studies 14487, The World Bank.
    5. Bjelic, Predrag, 2005. "Trade policy of the European Union as a factor of regional trade in Southeast Europe," LSE Research Online Documents on Economics 23374, London School of Economics and Political Science, LSE Library.
    6. Baccini, Leonardo, 2012. "Democratization and trade policy: an empirical analysis of developing countries," LSE Research Online Documents on Economics 44924, London School of Economics and Political Science, LSE Library.
    7. Ivan Savin & Peter Winker, 2009. "Forecasting Russian Foreign Trade Comparative Advantages in the Context of a Potential WTO Accession," Central European Journal of Economic Modelling and Econometrics, CEJEME, vol. 1(2), pages 111-138, November.
    8. Andrzej Cieślik & Jan Hagemejer, 2011. "The Effectiveness of Preferential Trade Liberalization in Central and Eastern Europe," Working Papers 2011-21, Faculty of Economic Sciences, University of Warsaw.
    9. Luca De Benedictis & Roberta De Santis & Claudio Vicarelli, 2005. "Hub-and-Spoke or else? Free trade agreements in the 'enlarged' European Union," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 2(2), pages 245-260, December.
    10. Libman, Alexander, 2008. "Federalism and regionalism in transition countries: A survey," MPRA Paper 29196, University Library of Munich, Germany.
    11. Julia Spies & Helena Marques, 2006. "Trade Effects of the Europe Agreements," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 274/2006, Department of Economics, University of Hohenheim, Germany.
    12. Cipollina, Maria & Salvatici, Luca, 2007. "EU and developing countries: an analysis of preferential margins on agricultural trade flows," Working Papers 7219, TRADEAG - Agricultural Trade Agreements.
    13. Alessia Amighini & Stefano Chiarlone, 2005. "New comparative advantages in the Central and Eastern European countries," LIUC Papers in Economics 182, Cattaneo University (LIUC).
    14. Roberta De Santis & Claudio Vicarelli, 2007. "The “deeper” and the “wider” EU strategies of trade integration.An empirical evaluation of EU Common Commercial Policy effects," ISAE Working Papers 79, ISTAT - Italian National Institute of Statistics - (Rome, ITALY).
    15. Agnes Szunomar (ed.), 2014. "Chinese investments and financial engagement in Visegrad countries - Myth or reality?," Economic books, Institute for World Economics - Centre for Economic and Regional Studies- Hungarian Academy of Sciences, number 201411.
    16. Agustin Carstens, 2004. "Making Regional Economic Integration Work," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 43(4), pages 335-352.
    17. Cardamone, Paola, 2007. "A Survey of the Assessments of the Effectiveness of Preferential Trade Agreements using Gravity Models," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 60(4), pages 421-473.
    18. World Bank, 2005. "Bosnia and Herzegovina : Country Economic Memorandum," World Bank Other Operational Studies 8676, The World Bank.

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