EU Market access for mediterranean fruit and vegetables: a gravity model assessment
Résumé
Since 1995, a liberalization process - the so-called Barcelona Process - has taken place in the Mediterranean area. Its aim is to establish by 2010 a free trade area in the Mediterranean Basin. For the moment full liberalization concerns trade in industrial products, but agriculture remains sensitive. Among agricultural products, the fruit and vegetables (F&V) sector is essential for Mediterranean countries, and the EU is their major trading partner. In this context, two questions arise: firstly, to what extent does protection influence trade for the Mediterranean countries compared to other countries? Secondly, what impact would greater liberalization in the F&V trade between the EU and Mediterranean Countries have? Our model, based on the new developments of the gravity trade model, focuses on the difficulties Mediterranean countries face in entering the EU market, compared to other EU partners, considering the relative impact of the different trade costs. The model is estimated at the product level, in a sector which is highly specific: some products may be very perishable and thus particularly time-sensitive. The Mediterranean basin appears as a highly heterogeneous country bloc. Beside the actual level of preferences allowed by the EU, two main elements vary according to the exporting country: its tariff sensitivity and its “nontariff” trade resistance. Thus, with respect to Euromed liberalization, the higher the tariff sensitivity, the higher the impact liberalization has on trade, and this impact can be limited by a high trade resistance (NTB, logistic constraints…).