Impact of European Union Assocation Agreements on Mediterranean Countries

Henri Ghesquière

No 1998/116, IMF Working Papers from International Monetary Fund

Abstract: By establishing free trade for industrial products in 12 years, the European Union’s Association Agreements with countries in the Mediterranean region seek to promote accelerated economic growth. This paper reviews the literature and evaluates the economic benefits and costs for Tunisia, Morocco, Lebanon, Egypt, and Jordan. It concludes that the benefits could be substantial, but only if accompanied by deep supplementary reforms, including extending trade liberalization to services and agriculture and on a multilateral basis, improving the environment for foreign direct investment, ensuring an adequate fiscal and exchange rate policy response, and strengthening European Union assistance.

Keywords: WP; SEM country; trade diversion; free trade; trade creation; EU agreement; SEM government; European Union; Trade liberalization; Mediterranean countries; EU company; EU exporter; economic reform; Eastern Mediterranean country; EU imports; EU consumer; Exports; Tariffs; Imports; Trade agreements; Europe; Eastern Europe (search for similar items in EconPapers)
Pages: 26
Date: 1998-08-01
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:1998/116

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