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

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  • Mr. Theodora Kosma
  • Antonis Adam
  • Mr. James McHugh

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

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

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    8. 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.
    9. Alessia Amighini & Stefano Chiarlone, 2005. "New comparative advantages in the Central and Eastern European countries," LIUC Papers in Economics 182, Cattaneo University (LIUC).
    10. World Bank, . "Bosnia and Herzegovina : Country Economic Memorandum," World Bank Other Operational Studies, The World Bank, number 8676, September.
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    12. Libman, Alexander, 2008. "Federalism and regionalism in transition countries: A survey," MPRA Paper 29196, University Library of Munich, Germany.
    13. Jelena Trivic & £ukasz Klimczak, 2015. "The determinants of intra-regional trade in the Western Balkans," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 33(1), pages 37-66.
    14. Zufarova, Nargiza, 2010. "EU regional trade vulnerabilities, liberalization and potential lessons for Uzbekistan trade reforms," Perspectives of Innovations, Economics and Business (PIEB), Prague Development Center (PRADEC), vol. 6(3), pages 1-4, October.
    15. 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.
    16. 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, Central European Journal of Economic Modelling and Econometrics, vol. 1(2), pages 111-138, November.
    17. 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.
    18. 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.
    19. 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.
    20. 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).
    21. Agustin Carstens, 2004. "Making Regional Economic Integration Work," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 43(4), pages 335-352.

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