Report: The trade effects of EU regional trade agreements

This report analyses the effects of EU regional trade agreements on trade in goods.

Since negotiations to conclude the World Trade Organisation’s (WTO) Doha Development Agenda stalled in 2008, the main efforts by the EU to liberalise trade have been undertaken in the context of regional trade agreements (RTAs). As a result, there has been growing interest in how effective they are in terms of stimulating trade. Another motivation for this report comes from the observation that almost all positive welfare effects related to trade agreements require more economic integration and international division of labour, i.e. trade. 

According to our main estimate, EU RTAs increase trade between the EU and its partners by 48 percent on average. With trade-weighted estimations, the effect increases from 48 to 56 percent.

While we find moderate to strong trade effects from EU RTAs, the effect associated with EU membership is far stronger. In our main regression, the effect of EU membership is four times larger than the impact from post-2010 EU FTAs, i.e. CETA-style FTAs.

A result that stands out is the trade impact of WTO membership. The average effect of GATT/WTO membership is 50 percent larger than the average effect of all RTAs globally.