Export performance in the 2004 European Union enlargement economies

Saturday, 19 March 2016: 11:30 AM
Maria Paula Fontoura, Ph.D , Economics, University of Lisbon, Lisbon, Portugal
On May 1st2004, a treaty of accession between the first fifteen Member States of the European Union (hereinafter “EU15”) and ten aspiring new Member States came into force. Given the relevance of the EU’s accession to these countries’ economic development, this study will focus on one of the major key points to promote a country’s long-term sustainable economic growth: export performance. More precisely, this study analyses the 2004 enlargement countries’ export performance in the EU15 for the period 1990 to 2013.

The differentiated characteristics of the 2004 enlargement economies reinforce the interest on focussing the export performance of these economies as they  include three former Soviet republics (Estonia, Latvia, and Lithuania), four former Soviet satellites (Poland, the Czech Republic, Hungary and Slovakia), a former Yugoslav republic (Slovenia) and two Mediterranean islands (Cyprus and Malta); i.e., seven economies that transited from a centrally planned economy to a market economy and seven economies that are part of the Economic and Monetary Union (the Euro). .

Relatively to previous studies, three aspects define the main contribution of this study:

  1. It analyses the export performance of the 2004 enlargement economies to the EU15 over a long time span.

  2. It makes use of two different Constant Market Share Analysis (CMSA) - an accounting method allowing an ex-post breakdown of a country’s (or group of countries’) export performance into different effects-, thus enabling a broader evaluation of the effective changes of these ten economies’ export performance.

  3. Manufactured goods are grouped into three different classifications of sectors: one considering the technological intensity of manufactured exports, another evaluating the specialization factors of the categories of manufactured products exported; and, finally, a third one that takes into account the dynamism of EU(15) demand.

The CMSA approaches were selected in order to disentangle different effective export changes, namely (i) those occurring in the exports growth rate of a country based on several assumptions which maintain constant the market share of the analysed economy to the destination markets (the EU15, in the case of this study) and (ii) the performance of a country’s relative exports specialization, comparing the country’s relative specialization growth with the World’s relative specialization growth.

Results provide information on the ten economies’ export performance as a group and individually considered and on the importance of each EU15 destination market to the export performance of these countries.