Regional potential of CEFTA-2006 and its future challenges

Abstract

The paper analyzes the trade and regional potential of CEFTA-2006. According to the official data, EU trade accounts for more than half of the total foreign trade of each country from CEFTA-2006. Also each of the member states depends on trade exchange of goods only on one or two major trading partners from the region, while the cooperation with the rest of the countries is insignificant. Consequently, since the Croatia exited from CEFTA-2006 in July 2013 and become member of EU, it will cause negative consequences for its most important trade partners in the free trade zone, especially for Bosnia and Herzegovina. Therefore, it is quite understandable why the Western Balkans countries have already lost interest for further trade integration in CEFTA-2006. The conclusion suggests that CEFTA-2006 never really exploit the real economic potential of the region which leaves no choice to the Western Balkans countries. They must persue further integration with the Union, as the only rational decision to avoid pessimistic scenarios for the region.