Edited By Gerhard Niedrist
The Impact of the EU-Mexican Trade Agreement on Revealed Comparative Advantage
Bonnie J. Palifka* & Jose de Jesus Salazar Cantu†
The EU-Mexico Free Trade Agreement took effect in July of 2000, eliminating import tariffs on Mexican manufactured goods to the European Union by 2003 and on European manufactured goods to Mexico by 2007. Unlike the North American Free Trade Agreement, this agreement has received almost no academic attention. Mexico had signed agreements with the European Union in 1975 and 1991, but these were limited in nature and had little impact. In 1997, the two parties signed the EU-Mexico Economic Partnership, Political Coordination and Cooperation Agreement, which entered into force on July 1, 2000. According to the European Commission (2009a), this treaty
“... has considerably strengthened bilateral relations between the EU and Mexico. It governs all relations between them, including a regular high-level political dialogue. It is based on shared values, such as democracy and human rights, and reflects Mexico’s relevance on the international scene”.
Figure 1. European (EU-15)-Mexican Trade, 1995-2008
Source: Elaborated with data from Eurostat.
← 15 | 16 → The Agreement has established a Free Trade Area (FTA) between the EU and Mexico that has enshrined their bilateral trade relations in a preferential framework and has helped to enhance their bilateral economic ties. The FTA has allowed significant growth in bilateral trade and has acted as a catalyst for investment flows. (European Commission, 2009a)
Figure 1 shows the evolution of trade flows between Mexico and the EU-15. Bilateral...
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