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Intra-Regional vs. Extra-Regional Trade Liberalization in Central America

Adolfo Cristóbal Campoamor, Manuel Alejandro Cardenete, Pedro Caldentey Del Pozo and Olexandr Nekhay
Authors registered in the RePEc Author Service: Adolfo Cristobal-Campoamor ()

Emerging Markets Finance and Trade, 2019, vol. 55, issue 8, 1880-1892

Abstract: Although the Central American countries trade very extensively with the USA, the remarkable growth of their intra-regional exports is prone to create more internal added value for the region. Taking this background into account, we use and compare a standard, perfectly competitive and an imperfectly competitive GTAP CGE model based on the GTAP 9 database, to assess different scenarios. Our simulations evaluate the elimination of all existing import taxes and export subsidies in 2011, both at the intra-regional level and vis-à-vis the USA. The results emphasize the preference by most of the Central American countries for the completion of the Customs Union at the expense of a deepening of the DR-CAFTA agreements.

Date: 2019
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DOI: 10.1080/1540496X.2018.1521802

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