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Economics Research International
Volume 2012 (2012), Article ID 691302, 11 pages
http://dx.doi.org/10.1155/2012/691302
Research Article

Unilateral Trade Preferences in the EU: An Empirical Assessment for the Case of Mozambican Exports

1Institute of Development Studies, University of Sussex, Brighton BN1 9RE, UK
2Independent Consultant, Via Passo Bocco 1, Parma, Italy

Received 4 August 2011; Revised 21 September 2011; Accepted 13 October 2011

Academic Editor: Priya Ranjan

Copyright © 2012 Xavier Cirera and Andrea Alfieri. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Unilateral trade preferences are one of the most important instruments offered by developed countries to foster developing country exports. This paper analyzes the impact of unilateral trade preferences on developing countries by focusing on the experience of Mozambique. In this paper, we analyze whether unilateral preferences offered by the EU are “valuable” for Mozambican exporters based on the impact on preferential margins, utilization rates, and export prices. We use a detailed dataset with cif unit values at HS8-digits level covering the period 2000–2007. Our findings indicate that (i) for a large number of product lines, export margins are zero; (ii) utilization rates are generally high; however, (iii) this does not translate into a positive price margins captured by Mozambican exporters compared to MFN competitors. These findings cast doubts on the “value” of preferences and their potential impact on developing country exports.