Trade activity between the EU and its neighboring countries: Trends and potential

Dimitris K;PINNA, ANNA MARIA

2013-01-01

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Abstract

The objective of the paper is to examine whether trade activity intensifies over time as the outcome of signed bilateral trade agreements. Focusing on (the trade component of) the European Neighborhood Policy, the paper conducts an in-depth study of trade activity between the EU and its neighboring countries, attempting to offer a detailed analysis in terms of trade patterns and to investigate whether proximity is combined with higher trade flows, within the framework of a free trade agreement. The analysis utilizes data derived from BACI database and covers the period from 1995 to 2011. The findings of the paper indicate that there is a lot of potential for the expansion of trade activity between the EU and its neighboring countries and accentuate the crucial determinants in this direction.