Development of convergence in foreign trade of the new EU-members

• Main Author: Marcel Ševela
• Format: Article
• Language: English
• Published: Mendel University Press 2005-01-01
• Series: Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis
• Subjects: foreign trade; convergence; European Union; EU-enlargement
• Online Access: https://acta.mendelu.cz/53/3/0195/

The importance of convergence in foreign trade is mentioned in the theory of optimum currency from the very beginning. Also the OCA index incorporates two basic aspect of foreign trade. The territorial reorientation is always characteristic for new EU-members and this process was already accomplished by most of the new EU-members. The more developed associated countries are already at the level of EU-members. The commodity orientation is connected highly with the competitiveness and level of development of the whole economy and the shares of sophisticated product in exports reflect it. Hence the evaluation was concerned on the manufactured goods, SITC group 7-Machinery and transport equipment and the high-technology intensive products. From viewpoint of commodity structure the countries joining EU in 1995 are the most successful. They are closely followed by the other EU-members. The new EU-members of 2004 are lagged, the lag is getting wider with the rise of technology intensity. Only the Czech Republic and Hungary are able to compete with the older EU-members. The commodity convergence of EU countries is runs very dynamically in new members, the shares of other EU countries are almost constant. The results of intra-industry trade also reflect the lag in competitiveness of economies under transition. The transition countries are very heterogeneous in the intra-industry trade as well. The internal structure of transition countries is similar to result obtained when assessing the commodity structure.