Trade of agri-food products in the EU enlargement process: Evidence from the Southeastern Europe

Abstract

Since the last decade, significant changes have occurred in the trade flows of agri-food products of the Southeastern European countries (SEE) due to adjustment to international market. Namely, as all countries of the SEE strive to be full members of the EU; market opportunities have been changing, primarily because of the reduced barriers on trade with the EU, as well as with the regional countries. In order to investigate the effects of the liberalization process of the agri-food sector of the SEE countries on their export, as well as the total foreign trade, a gravity model based on panel data in the period 2005–2015 has been estimated. According to the results, liberalization of the market in the SEE countries, as a consequence of the EU enlargement process, as well as regional integrations, had positive effects on the total foreign trade of agri-food products. Despite the positive liberalization effects on the agri-food trade, all SEE countries have a lower level of competitiveness than the EU countries, so an organized access to products which possess comparative advantages will be an important condition for the achievement of their particular positions at the international market.

How CEFTA influenced the competitiveness of agri-food trade in the Western Balkans

“…The results clearly indicate that Serbia achieves the best results, while Albania the worst (Matkovski et al, 2016;Matkovski et al, 2019). As far as econometric modelling using the gravity model is concerned, previous research also indicates a significant and positive effect of the CEFTA agreement on export flows of agrifood products (Dragutinović-Mitrović & Popović-Petrović, 2013, Matkovski et al, 2018a, Matkovski et al, 2018b. However, given the importance of agriculture and especially the agri-food sector for all the aforementioned economies of the CEFTA region, the current level of competitiveness at the overall regional level implies there is an need to improve this competitiveness (Birovljev et al, 2017).…”

“…The effects of trade liberalisation induced by CEFTA are estimated using the gravity model with panel data. Since Tinbergen (1962), a number of specifications of this model have been derived, and this paper uses a linear form of the model similar to that in the paper of Dragutinović-Mitrović and Popović-Petrović (2013) and Matkovski et al (2018b):…”

“…According to the research of Matkovski et al (2018a), in the 2005-2015 period, there was a deficit in the agri-food trade in all the Western Balkan economies, except for Serbia, while results of the estimations of the gravity model showed that CEFTA impacted unevenly on the individual exports of the economies of this region. The main trade partner of the Western Balkan economies was the EU, although intensified trade in agri-food was present inside the CEFTA region with similar tendencies in both export and import (Matkovski et al, 2018b). Also, Uberti and Demukaj (2019) analysed regional integration, trade, and development in the Balkans using a dynamic Poisson estimator in panel data.…”

Export Competitiveness of Agri-Food Sector during the EU Integration Process: Evidence from the Western Balkans

“…One of the main causes, among others, is the low level of agricultural productivity [ 5 ]. Under the influence of the reached agreements on free trade, there was a partial change in the orientation of foreign trade of agri-food products of the WB and intensification of foreign trade flows with EU countries and CEFTA countries [ 6 , 7 ]. In that context, it is necessary to analyse the significance and intensity of foreign trade of agri-food products of these countries.…”