Revealed Specialisation and the Competitiveness of the CEE Economies

Abstract

It was established in Chapter 6 that the exports of the CEE-10 to the EU-15 contained significantly higher proportions of labour-intensive and resource-intensive goods and lower proportions of human capital-intensive goods than were contained in the general structure of both intra-EU trade and EU imports from the rest of the world. However, this indicates that the CEE economies were capable of penetrating EU markets in some human capital-intensive sectors, including sectors embodying high-technology, which could become the basis of export expansion in the future. Resource intensive and labour-intensive sectors also embrace a wide range of different industries, with different characteristics and implications for existing EU producers and economic restructuring in the CEE. Which sectors of industry are the most likely to expand in the CEE economies and which to contract if industrial concentration takes place in Europe as predicted in Chapter 2? Will the liberalisation of trade relations between the EU and CEE-10 result in increased imports from CEE-10 economies at the expense of imports from the rest of the world or will the removal of trade barriers result in the displacement of existing EU producers, and if so, in which industrial sectors will this be most important? In which specific industrial sectors will trade liberalisation leave the domestic industries of the CEE economies vulnerable to competition as they open their markets to competition from EU manufacturers?