Page 23 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.74, # 1, 2017, pp. 23-33

TRADE OF THE EU WITH EASTERN EUROPEAN COUNTRIES
(CASE OF UKRAINE AND TURKEY)

Evangelos Siskos
D.Sc. Professor of International Economic Relations
Department of Business Administration (Kozani),
Western Macedonia University of Applied Sciences
(TEI of Western Macedonia), Greece
e-mail: [email protected]

Konstantia Darvidou
Ph.D in International Economic Relations
Western Macedonia University of Applied Sciences
(TEI of Western Macedonia), Greece

Received 20 December 2016; accepted 24 May 2017; published online 10 July 2017

Abstract
Trade security issues involve customs control and trade facilitation, sustaining
competitiveness of domestic producers under open economy, optimization of foreign
trade structure, stability of trade flows, and dependency on markets and suppliers.
We analyze the structure and trends in exports of the EU-28 Member States, Ukraine
and Turkey, as well as their bilateral trade in goods and services. Nowadays both
these countries have trade preferences in bilateral trade with the EU. Considering
goods export structures, Turkey is much more competitor for the EU than Ukraine.
Ukraine is rather a complementary economy to the EU and no Member State is
vulnerable to competitive pressure from Ukrainian exports of goods. Despite both
Turkey and Ukraine have similar levels of services export structure similarity with
the EU, Ukrainian services exports are 6 times lower than the ones of Turkey,
therefore threat of competition with Ukraine is minor. Competition with Ukrainian
services exports is relatively higher in Central Europe, but since transport is a major
type of services, competition can be balanced by cooperation benefits based on route
connectivity under geographical proximity. Turkey is a major competitor to
Southern Europe (especially Greece) and some other Member States. Turkey is
larger trade partner for the EU because of higher income per capita than in Ukraine
and longer period of free trade regime with the EU. Economic recovery of Ukraine
after the crisis in 2014-15, free trade regime and approximation of customs
legislation of Ukraine under the Association Agreement can also help to facilitate
bilateral trade and improve trade security. Economic development of Ukraine based

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