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Quantitative assessment of EU-Mediterranean trade liberalization using the CAPRI modelling system. Lucie Weissleder Institute for Food and Resource Economics University of Bonn, Germany. Outline of the presentation. The CAPRI Model Simulation Scenarios Partial liberalisation
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Quantitative assessment of EU-Mediterranean trade liberalization using the CAPRI modelling system Lucie Weissleder Institute for Food and Resource Economics University of Bonn, Germany
Outline of the presentation • The CAPRI Model • Simulation Scenarios • Partial liberalisation • Full liberalisation • Selected results • Conclusions
The CAPRI model • CAPRI: • Developed by the Institute for Food and Resource Economics, University of Bonn and Partners • Main features: • Agricultural sector model • Regionalised optimisation modules for EU25 • World-wide trade model • Changes in the CAPRI model for the project
Mediterranean products • Supply and market model now features additionally as endogenous products: • Tomatoes • Apples, pears and peaches • Citrus fruits • Table grapes • Other fruits • Potatoes • Other vegetables • Olive oil • Wine • In total some 40 products EU Entry Price System
Split up „Med country block“ • Own behavioral equations in trade model for: • Morocco • Tunesia • Algeria • Egypt • Turkey • Israel • Morocco and Turkey as individual countries (new), Tunesia, Algeria, Egypt and Israel aggregated in a remaining “Med” block
The CAPRI model: Policy • World-wide: • Tariffs and TRQs • For the EU • Minimum Entry Price -> NEW • Problem: seasonality • Export subsidies • Intervention purchases • Direct payments
Simulation Scenarios Two Scenarios have been defined • Partial EU-MED liberalisation • Full EU-MED liberalisation
Results • Trade flows • Partial liberalisation • EU imports • EU exports • Full liberalisation • EU imports • EU exports • Prices
Only small effects on EU markets, but notable changes for individual countries from the mediterranean area Conclusions • Partial EU-MED liberalisation • EU Imports: • Cereals ± 0% • Morocco: +1% • Other countries unaffected • Vegetables and permanent Crops +2.5% • Morocco: +20% • Turkey -3% • Other mediterranean ± 0% • Other product groups mainly unchanged • EU exports • Only very minor changes • EU prices • Unchanged
Conclusions • Full EU-MED liberalisation • EU imports • Cereals: +11% • Turkey +145% • Other mediterranean +100% • Morocco +30% • Vegetables and permanent crops +19% • Other mediterranean +300% • Turkey +60% • Morocco +60%
Significant increase of trade for cereals and vegetables and permanent crops Conclusions • EU exports • Cereals +20% • Turkey: +500% • Other mediterranean: + 98% • Morocco: +70% • EU prices • Cereals +4.1% • Other products only small changes
Quantitative assessment of EU-Mediterranean trade liberalization using the CAPRI modelling system Lucie Weissleder Institute for Food and Resource Economics University of Bonn, Germany
Appendix – Additional Slides Partial EU-Med liberalisation combined with the WTO G20 proposal
Simulation Scenario: Partial EU-MED + WTO G20 • Export subsidies will be eliminated • LDC countries are exempted from tariff cuts
Results • EU imports • Overview • Specific countries • EU exports • Overview • Specific countries • Price changes
Conclusions • Inconsistent changes in the imports from Turkey, Morocco and the Med. block • Changes depend on the competitiveness of the individual countries • Preferential situation decreases visibly • The exports of the EU increase in general with a few exceptions
