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Email this citationCIAO DATE: 04/04
South East Europe and the Trade Potential of Croatia
Boris Vujcic and Vedran Sosic
January 2004
Abstract
The ques tion of the trade regime for Central and Eastern European countries (CEEC) has dur ing the last decade been the s ubject of an intense discussion amongst the policymaker s and academia from both within the region and from the EU. The main issues around which the discussion has concentrated w ere those of enhancing the catching-up proces s by the means of trade liberalization, and protection of the "sens itive" industries within the EU.
Regarding the design of the trade regime for the South East European (SEE) countries2, the iss ue of the speed of their acces sion towar ds the EU, and/or regional approach has added a new component to the discuss ion. The current dis cussion has not been very insightful with res pect to the "hard facts" on the present level of integr ation within the region and its relationship with the EU. An obvious f act is that all countries have in one way or the other been excluded from international trade integration during the nineties. A lso, it is obvious that the region is an economic dw arf, which makes any serious competitive threat to the EU highly unlikely.
In this paper we f irst present some stylized facts on the Croatian tr ade, and the SEE trade. Second, we analyze the level of tr ade integr ation within the region, using simple tools s uch as trade opennes s ratio and trade concentration indices. We try to explain w hy the trade development in Croatia did not observe the expected transitional behavior . Then we obser ve selected trade iss ues arising from the specific institutional f eatur es of thes e countries. Finally, we discuss the "correct" des ign of the trade regime f or Cr oatia and SEE.
