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Bussière, Matthieu; Fidrmuc, Jarko; Schnatz, Bernd --- "Trade integration of the new EU member states and selected South-East European countries: lessons from a gravity model" [2005] ELECD 390; in Liebscher, Klaus; Christl, Josef; Mooslechner, Peter; Ritzberger-Grünwald, Doris (eds), "European Economic Integration and South-East Europe" (Edward Elgar Publishing, 2005)

Book Title: European Economic Integration and South-East Europe

Editor(s): Liebscher, Klaus; Christl, Josef; Mooslechner, Peter; Ritzberger-Grünwald, Doris

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781845425173

Section: Chapter 15

Section Title: Trade integration of the new EU member states and selected South-East European countries: lessons from a gravity model

Author(s): Bussière, Matthieu; Fidrmuc, Jarko; Schnatz, Bernd

Number of pages: 27

Extract:

15. Trade integration of the new EU
member states and selected
South-East European countries:
lessons from a gravity model
Matthieu Bussière, Jarko Fidrmuc
and Bernd Schnatz1

1. INTRODUCTION

Over the past ten years, Central and South-East European countries
(CEECs and SEECs) experienced rapid trade integration with the euro
area, which had two major implications. From a euro area perspective, the
share of these countries in extra-euro area trade2 almost doubled between
1993 and 2003, from 7 per cent to 13 per cent.3 Taken as an aggregate, the
whole region now represents the euro area's third largest trading partner
behind the United Kingdom (15.8 per cent) and the USA (13.6 per cent).
For the CEECs and SEECs, in turn, the euro area represents the most
important trading partner. The share of the euro area in the Czech
Republic, Hungary, Poland, Slovenia and Romania (measured as percent-
age of imports and exports of these countries), is close to 60 per cent; for
Albania it reaches almost 80 per cent, while for Bosnia and Herzegovina,
FYR of Macedonia, Bulgaria and the Slovak Republic it is closer to 50 per
cent but quickly rising.
The natural question that arises from these stylized facts is whether the
increasing integration of the CEECs and SEECs with the euro area is likely
to continue in the years to come, or rather to slow down. The answer to this
question depends to a large extent on the interpretation of past ...