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Journal of African Economies Advance Access originally published online on May 9, 2006
Journal of African Economies 2007 16(2):259-300; doi:10.1093/jae/ejl021
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© The author 2006. Published by Oxford University Press on behalf of the Centre for the Study of African Economies. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org

An Examination of Morocco's Trade Options with the EU

G. Philippidis* and A.I. Sanjuán

Centro de Investigación y Tecnología Agroalimentaria (CITA), Agricultural Economics Unit, Government of Aragon, Spain

* Corresponding author. G. Philippidis; E-mail: gphilippidis{at}aragon.es

As a moderate North African Arab state, Morocco has ratified preferential free trade agreements with both the EU and the USA. However, the potential importance of improved agro-food market access with the EU has been largely ignored in Morocco-EU Association Agreement (MEAA). Indeed, in comparison with the depth of the agro-food reforms in the Morroco-US agreement, the MEAA is largely incomplete. Accordingly, as a first objective we employ a modified computable general equilibrium (CGE) model to assess the potential for further long run trade and growth in Morocco through agro-food tariff abolition. Moreover, we investigate whether there is an economic incentive for such a EU countermovement to restore competitive parity with the US. As a further aim, we examine the trade inhibiting implications of non-tariff barrier (NTB) trade costs (e.g., red tape, licensing laws etc.), which have hitherto largely escaped reform. Thus, we estimate NTB trade cost tariff equivalents (TEs) employing a theoretically consistent gravity specification. TEs are implemented into our CGE model to measure the trade and growth impacts from NTB removal in agro-food and across all Moroccan-EU trade. While agro-food liberalisation yields disappointing results for Morocco, the potential for development-led policies through elimination of NTBs is highly appealing.

JEL classification: F1, F12, F15, F17


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