Author(s): Katarína Baráthová, Artan Qineti
Title: Comparative Advantages of the United Kingdom's Agri-food Trade in Relation to the EU
Source: International Scientific Days 2018 :: Towards Productive, Sustainable and Resilient Global Agriculture and Food Systems :: Proceedings
ISBN: 978-80-7598-180-6
DOI: https://doi.org/10.15414/isd2018.s13.02
Publisher: Wolters Kluwer ČR, Prague
PY, pages: 2018, 2378-2389
Published on-line: 2018-11-09
Language: eng
Abstract: The United Kingdom as a member of the EU can enjoy full access to the Single European
Market. In terms of agri-food trade, the EU is UK’s most important trading partner.
However, in June 2016, the UK opted to leave EU. This decision will significantly influence
the whole economy of the UK including agri-food trade. Therefore, the objective of
this paper is to examine development and comparative advantages of The United Kingdom’s
agri-food trade with respect to the EU-27 markets. The analysis is based on Balassa
index and its stability over the period. Agri-food trade data used in paper are classified
according to the Harmonised System (HS). The data were acquired from Eurostat
Comext database and cover the period 2000-2016. An analysis showed that over the
period, the UK was able to retain comparative advantages only in three categories – HS
03 Fish, HS 21 Miscellaneous edible preparations, HS 22 Beverages, spirits and vinegar.
In the rest of agri-food commodities the declining trend can be observed and in 2016 the
UK had comparative disadvantages in 21 agri-food commodities. Based on the results of
regression analysis focused on the stability of distribution of Balassa indices over time, we
can conclude that the degree of specialization in the agri-food trade between the United
Kingdom and the rest of the EU has been decreasing as the number of commodity groups
with a comparative advantage has been declining. With respect to Brexit, the agrarian
trade of the UK deserves special attention, because the potential increases in trade costs
are expected to affect the UK proportionally more than the EU27.
Keywords: agri-food trade, Balassa index, comparative advantage, the United
Kingdom
JEL Classification: F10, F14, Q17
Rights:Open Access :: Creative Commons BY-NC-SA 4.0 International Licence
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