Diversification or Specialisation tesi Cecilia
Diversification or Specialisation? Assessing the Impact of DCFTAs on Eastern Partnership
Countries
Supervisor: Alessandra Brozzu
Cecilia Salomone i6339434
c.salomone@student.maastrichtuniversity.nl
16/06/2026
Bachelor Thesis (EUS3900)
Contents
1. Introduction 3
2. State of the Art 6
2.1 The European Neighborhood Policy 6
2.2 The Deep and Comprehensive Free Trade Areas 7
2.3 Export diversification 8
2.4 The Southern Neighborhood 9
3. Analytical Framework 10
3.1 Theoretical Framework 10
3.2 Case selection 13
3.3 Data selection 14
3.4 Methodology 15
4. Analysis 16
4.1 Robustness Check 20
5. Discussion 21
5.1 Strengths and Limitations 23
6. Conclusion 24
List of Tables and Figures
1. Table 1: Summary Statistics…………………………………………………………….15
2. Table 2: HHI Summary Statistics by Group…………………………………………….15
3. Figure 1: Average HHI by Group, 2010-2021…………………………………………..16
4. Figure 2: Export Concentration (HHI) by Country, 2010-2021…………………………17
5. Table 3: Effect of DCFTAs on Export Concentration (HHI) ……………………………18
6. Table 4: Effect of DCFTAs on Export Concentration (HHI) – Robustness Check………19
4
1. Introduction
The European Union (EU) has used the European Neighbourhood Policy (ENP) as a strategic
framework to promote stability, prosperity, and economic integration within its immediate
periphery. The ENP was established in the early 2000s, and was originally conceived to create a
“ring of friends” by fostering closer political and economic ties, although it intentionally excluded
the possibility of full membership (Smith, 2005). Since its creation, the ENP has been conceived
around three interconnected objectives: stabilisation, integration, and partnership with neighbouring
states, thus reflecting the EU’s strategic interest in projecting stability beyond its borders, but still
without offering perspectives of real accession (Missiroli et al., 2003).
At the centre of this strategy, there has been the employment of trade agreements as primary
instruments of integration, designed to facilitate market access, promote regulatory convergence,
and incentivize domestic reforms. Over time, however, the EU has increasingly adopted
differentiated approaches toward its neighbouring regions, resulting in a notable divergence
between the Eastern Partnership countries and those situated in the Southern Neighbourhood. While
the majority of Southern Neighbourhood countries operate under relatively limited Association
Agreements that focus primarily on tariff liberalization and trade in goods, a subcategory of Eastern
Partnership countries, precisely Georgia, Moldova, and Ukraine, have entered into Deep and
Comprehensive Free Trade Areas (DCFTAs). These agreements represent the most advanced form
of economic integration available that does not include full EU membership, going far beyond
standard trade liberalisation by requiring extensive alignment with the EU acquis (European
Commission, n.d.). Through mechanisms of legislative approximation, DCFTAs require partner
countries to adopt rigorous EU standards in diverse areas, such as technical regulations, sanitary and
phytosanitary measures, and public procurement, thereby deeply embedding EU rules within legal
and institutional frameworks of the targeted nations.
This differentiation raises critical questions regarding the ultimate effectiveness of the EU’s
external economic strategy: from a theoretical perspective, DCFTAs can be interpreted as
instruments of “Market Power Europe,” a paradigm in which the EU externalizes its internal
regulatory framework by leveraging the attractiveness of its vast single market (Damro, 2012). By
conditioning access to this market on strict compliance with its rules, the EU incentivizes partner
countries to align with its specific regulatory standards. In principle, such deep integration is
expected to stimulate economic modernization by enhancing competitiveness, improving
institutional quality, and facilitating access to higher-value markets. Empirical evidence supports
5
this expectation to a certain degree, showing that DCFTA countries have significantly shifted their
trade toward the EU, which has emerged as the main trading partner for countries such as Ukraine
and Moldova (Emerson & Movchan, 2021; Emerson & Cenușa, 2021). However, the extent to
which these comprehensive agreements translate into substantive economic transformation remains
a subject of intense contestation. In fact, while DCFTAs impose far-reaching regulatory and
administrative requirements, their realized benefits may be uneven and remain highly contingent on
specific domestic conditions. Existing research highlights that, despite notable progress in
legislative alignment, countries such as Georgia, Moldova, and Ukraine have not yet achieved the
necessary level of “integration maturity” to fully take advantage of the opportunities offered by
such deep economic integration (Nielsen & Šiljak, 2024). At the same time, there are many and
persistent structural challenges, such as weak institutional capacity, corruption, political instability,
and significant geopolitical pressures, that continue to constrain the effectiveness of EU-driven
reforms (Sierra, 2011; Emerson et al., 2021). Furthermore, a comparison with Southern
Neighbourhood countries complicates the evaluation of EU external policies: despite operating
under less comprehensive agreements and facing lower regulatory burdens, these countries have not
achieved comparable levels of economic integration with the EU, and intra-regional trade remains
limited (European Commission, 2025). This contrast highlights a central puzzle: although DCFTAs
represent a more ambitious and demanding model of integration, it is not immediately evident
whether they produce significantly superior economic outcomes compared to simpler trade
arrangements.
One dimension that remains significantly underexplored in current literature is the impact of
these agreements on the fundamental structure of exports. While much of the existing scholarship
focuses on trade volumes or institutional convergence, export diversification, defined as the
distribution of a country’s trade across various sectors, serves as a primary indicator of structural
transformation and economic modernization. This gap is particularly significant in the context of
DCFTAs, which are explicitly designed not only to increase trade flows but also to move partner
countries toward more sophisticated, high-value-added production. Within this context, this thesis
seeks to address this scholarly gap by examining whether the deeper regulatory integration required
by DCFTAs fosters more diversified export structures compared to the less comprehensive
agreements found in the Southern Neighbourhood. Thus, the research question it asks is: “to what
extent have DCFTAs affected export diversification in Georgia, Moldova, and Ukraine relative to
selected Southern Neighbourhood countries with comparable EU Association Agreements?” In
order to answer the research question, the first hypothesis is formulated: "H1: DCFTAs are
6
associated with decreased export concentration (increased diversification) among Eastern
Partnership countries relative to Southern Neighbourhood comparators in the post-2016 period." A
second hypothesis complements it: H2 states that “Morocco, Tunisia, and Jordan, operating under
shallower Association Agreements that do not require comparable regulatory approximation, will
display no significant change in export concentration over the same period.” To address this, the
thesis employs a difference-in-differences (DiD) design using panel data on the Herfindahl-
Hirschman Product Concentration Index (HHI) from the World Bank World Integrated Trade
Solution (WITS) database for the period 2010–2021. Contrary to expectations, the analysis finds
that DCFTAs are associated with a modest but statistically significant increase in export
concentration, suggesting that deeper EU integration may encourage specialisation, instead of
diversification, in the short to medium term.
From the academic perspective, this thesis contributes to a growing but still limited body of
literature, that examines the structural economic effects of EU trade agreements, moving beyond the
more commonly studied fields of trade and institutional convergence. The comparative analyses
between DCFTAs countries and the Southern Neighbourhood partners still remain scarce and, more
importantly, the relation between normative in-depth integration and export diversification has not
been rigorously examined yet. Regarding the social aspect, this research is directly relevant to the
EU enlargement policy: Georgia, Moldova and Ukraine are now formally recognised as candidate
countries to enter the EU; therefore, understanding whether the DCFTAs these three countries
signed in 2014 have brought the economic and structural transformation that they were conceived
for is fundamental. The result of this examination may have implications on the way future trade
instruments linked to EU accession will be designed and evaluated. Moreover, export
diversification is a crucial indicator of economic resilience: countries with a restricted export
foundation are disproportionately exposed to external price shocks, making this question a matter of
practical importance for the populations of the studied countries as well.
This thesis will proceed as follows. Section 2 presents the state of the art and reviews the the
relevant literature on the ENP, DCFTAs, export diversification, and the Southern Neighbourhood.
Section 3 then presents the analytical framework, including the theoretical lenses though which the
research will be conducted, the case and data selection, and methodology. Section 4 is dedicated to
the empirical analysis, which is discussed in Section 5. The conclusion summarises this paper’s
contribution to the literature, addresses its limitations, and suggests possible avenues for further
research.
7
2. State of the Art
The European Union’s (EU) engagement with neighboring countries through trade and
regulatory integration has led to extensive academic debate concerning both its transformative
potential and its structural limitations. This body of research is defined by a central debate among
scholars: while some view the EU as a powerful global economic force, others remain skeptical,
arguing its influence declines, and becomes less sustainable, when the promise of membership is off
the table. In this literature review, the key contributions regarding the EU’s role as a regulatory
power, the functional evolution of Deep and Comprehensive Free Trade Areas (DCFTAs), and the
multifaceted domestic and foundational constraints shaping their outcomes are presented.
Furthermore, a significant literature gap regarding the evolution of export structures is identified,
positioning export diversification as a relevant, but underexplored, aspect of economic
transformation within the EU neighborhood.
2.1 The European Neighborhood Policy
The European Neighbourhood Policy suffers from a structural weakness: it demands
substantial reforms while offering limited incentives in return, as Smith (2005) argues. The absence
of a credible membership perspective reduces the effectiveness of EU conditionality and weakens
its transformative potential. Similarly, Hoekman (2016) criticizes the ENP’s “everything but
institutions” approach, suggesting that imposing the EU acquis on non-candidate countries may be
both costly and inefficient, particularly when alternative regulatory frameworks could achieve
similar outcomes with lower adjustment costs. A theoretical framework that helps explain this
structural weakness is EU conditionality theory, developed by Schimmelfennig and Sedelmeier
(2004), which argues that the EU's ability to promote reform in neighbouring countries depends
fundamentally on the credibility and attractiveness of the incentives it offers in return for
compliance. Where the EU can offer a clear and credible membership perspective, conditionality is
strong and partner countries have powerful incentives to implement demanding reforms. However,
in the absence of such a perspective, as is the case for the Eastern Partnership countries, which hold
candidate status but do not see a concrete accession timeline, compliance incentives are weaker, and
domestic actors are less compelled to absorb the full costs of regulatory alignment (Schimmelfennig
& Sedelmeier, 2004). This thoery is especially relevant for DCFTAs: while they represent the
deepest form of regulatory integration the EU offers, short of membership, the absence of a credible
8
accession prospect might limit the revolutionary force they wield on domestic economic structures."
Within the ENP framework, DCFTAs represent the most advanced form of economic integration
short of EU membership: the EU positions these agreements as vital tools for eliminating trade
barriers and boosting regional competitiveness by harmonizing regulatory standards (European
Commission, n.d.).
2.2 The Deep and Comprehensive Free Trade Areas
A central theoretical framework for understanding the EU’s external economic influence is
Damro’s (2012) concept of “Market Power Europe.” Rather than conceptualizing the EU primarily
as a normative actor, Damro argues that its power derives from the size and attractiveness of its
internal market, which allows it to project its own regulatory standards onto the global dimension.
This way, third countries are incentivised to align with EU standards in order to gain access to this
market, while the EU’s institutional capacity allows it to act as a global standard-setter (Damro,
2012). This process of regulatory externalization underpins the EU’s trade relations with
neighboring countries and is particularly evident in the design of DCFTAs. These agreements
operationalize this form of power by requiring extensive legislative approximation to the EU acquis.
In the case of Ukraine, for instance, the agreement mandates alignment in areas such as technical
regulations, sanitary and phytosanitary standards, and public procurement, thereby embedding EU
rules within domestic legal systems (European Commission, n.d.). From this perspective, DCFTAs
can be understood as instruments of top-down Europeanization, through which the EU seeks to
induce both institutional and economic transformation in partner countries.
This aligns with broader academic interpretations of DCFTAs as fundamental instruments to
achieve prosperity and security, shared between the EU and its Eastern neighbors through deepened
market integration (Muravska & Berlin, 2016). More broadly, EU trade relations with neighboring
regions aim to promote economic integration and remove barriers to trade and investment,
particularly within the Euro-Mediterranean framework (European Commission, 2025). It is exactly
in this disputed context that DCFTAs appear as the EU’s most ambitious attempt to deepen
integration with its Eastern neighbors, definitely going beyond what standard Association
Agreements offer. Empirical studies provide partial support for these expectations, though the
outcomes appear slightly complex. Nielsen and Šiljak (2024) argue that DCFTAs create a
“beneficial platform” for economic modernization, introducing the concept of “integration
maturity”, referred to as the economic preparedness, to assess the extent to which countries are able
to exploit the benefits of integration. While Georgia, Moldova, and Ukraine have made measurable
9
progress in aligning with EU standards, they have not yet achieved the level of economic
competitiveness required to fully benefit from integration (Nielsen & Šiljak, 2024). Moreover,
analyses on specific countries illustrate both the achievements and limitations of DCFTAs: in
Ukraine, the implementation of the Association Agreement has led to a significant reorientation of
trade toward the EU, which has become the country’s primary trading partner (Emerson &
Movchan, 2021). Similarly, Moldova has experienced a substantial increase in exports to the EU,
which now accounts for a dominant share of its total trade (Emerson & Cenușa, 2021). Georgia has
also deepened its trade relations with the EU through tariff liberalization and regulatory reforms,
facilitating greater market access (Emerson et al., 2021). These developments suggest that DCFTAs
are effective in promoting trade integration and redirecting economic linkages toward the EU.
However, the literature emphasizes that these changes do not necessarily translate into deeper
structural transformation. In this sense, while trade volumes have increased, the composition of
exports often remains concentrated in low-value sectors, raising questions about whether regulatory
convergence alone is sufficient to generate meaningful economic modernization.
A substantial body of literature also highlights the constraints on EU influence arising from
domestic political conditions and external geopolitical pressures. Sierra (2011) demonstrates that
the EU’s ability to shape domestic policies in Georgia is limited by competing development models
and geopolitical dynamics, particularly the influence of Russia. The adoption of alternative
economic strategies can conflict with the EU’s regulatory approach, reducing the effectiveness of
the Europeanization processes. These findings are reinforced by empirical evidence from DCFTA
countries: in Ukraine, reforms in areas such as governance and anti-corruption have been uneven
and frequently undermined by political interference (Emerson & Movchan, 2021). Moldova
continues to face persistent challenges related to institutional weakness and political instability,
despite progress in legislative alignment (Emerson & Cenușa, 2021). In Georgia, concerns about
democratic backsliding and elite influence further complicate the implementation of EU-driven
reforms (Emerson et al., 2021). These patterns suggest that the success of DCFTAs is highly
dependent on domestic institutional capacity and political will. While the EU can provide a
framework for reform, the extent to which this framework translates into tangible economic
outcomes depends on local conditions: this reinforces the argument that regulatory alignment alone
is insufficient to guarantee structural transformation, including export diversification. Despite
registered and measurable progress in trade “reorientation”, export concentration continues to be
focused in low value-added sectors, across all three countries: this raises an essential question,
10
which the existing literature has not yet addressed, that is whether DCFTAs produce the structural
transformation of export composition that is implied by their plan.
2.3 Export diversification
In order to assess the structural impact of DCFTAs, we need a measure that goes beyond
aggregate trade volumes and captures changes in the composition of exports. In this sense, the
concept of export diversification provides an important lens through which to assess economic
transformation. While general economic literature establishes a clear link between diversified
export structures and increased resilience to external shocks, this dimension remains significantly
under-researched within the specific framework of the European Neighbourhood Policy. Current
studies on the Eastern Partnership predominantly focus on aggregate trade volumes, regulatory
convergence, or institutional reforms. This represents a significant scholarly gap, as recent
empirical findings suggest that while DCFTAs have successfully increased trade flows, they have
yet to trigger a broad structural transformation of the export basket (Bochorishvili & Baakashvili,
2014). Consequently, the question of qualitative economic modernization, specifically the shift
toward higher value-added sectors, remains insufficiently addressed, with partner states often
maintaining high levels of export concentration in low-complexity goods (Keshelava et al., 2026).
By positioning export diversity as the primary indicator, this study evaluates whether DCFTAs
fulfill their goal to promote a deep structural innovation beyond mere trade liberalization. Since
DCFTAs were explicitly conceived not only to increase trade flows, but also to orientate partner
countries towards a more sophisticated production with higher added value, this analysis is
particularly meaningful, as export diversification becomes the natural parameter to evaluate the
agreement’s’ effectiveness.
2.4 The Southern Neighborhood
The experience of the Southern Neighbourhood provides an important comparative perspective
for assessing the effectiveness of DCFTAs. In fact, unlike Eastern Partnership countries, most
Southern neighbors operate under less comprehensive Association Agreements that focus primarily
on trade liberalization rather than deep regulatory integration (European Commission, 2025). While
these agreements aim to promote economic cooperation within the Euro-Mediterranean region, their
impact has been relatively limited. Intra-regional trade among Southern neighbors remains low, and
11
efforts to negotiate DCFTAs with countries such as Morocco and Tunisia have stalled (European
Commission, 2025).
The limited structural impact can be derived from empirical assessments of the Southern
Neighborhood Association Agreements. The European Commission's own ex-post evaluation of the
Euro-Mediterranean Association Agreements with Algeria, Egypt, Jordan, Lebanon, Morocco and
Tunisia found that, while these countries have gained modest benefits from the preferential EU
market access, improvements in economic elaborateness and export diversification were limited
(European Commission, 2021). This evidence is confirmed by Hoekman and Zarrouk (2009), who
attribute the limited structural adjustment in Southern Neighborhood countries to persistent
institutional weaknesses and underdeveloped factor markets, that prevent countries from taking full
advantage on trade preferences. Furthermore, research on individual countries’ outcomes suggest
asymmetric and generally modest effects, with some countries, such as Morocco, recording positive
export impacts, while Jordan and Tunisia show negligible or negative results (Bchir et al., 2014).
Overall, this data hints that the shallower Association Agreements in the Southern Neighbourhood
have not generated the fundamental transformation their designers intended, providing an important
reference point from which to assess the deeper integration offered by DCFTAs.
In summary, the literature explored here highlights a consistent pattern: while both DCFTAs and
shallower Association Agreements have succeeded in increasing trade flows and repositioning
economic ties towards the EU, neither of the two models has yet produced the broad-scale export
diversification that such a transformation requires. This gap between regulatory alignment and
actual structural change in export composition constitutes the central puzzle that this thesis
addresses, through a systematic comparative analysis of the two groups.
3. Analytical Framework
3.1 Theoretical Framework
Evaluating whether Deep and Comprehensive Free Trade Areas (DCFTAs) actually
diversify exports requires a framework that bridges the EU’s external economic strategy with the
structural realities of partner nations. By comparing Eastern Partnership countries with Southern
Neighbourhood partners, who lack such agreements, it is possible to isolate the causal mechanisms
driving economic change. Export diversification is used as a definitive measure of substantive
economic modernization.
12
“Market Power Europe” (MPE) is the concept that guides the analytical framework of this
study; developed by Damro (2012), it offers a robust theoretical lens for understanding the
mechanics of the EU’s external economic influence. According to this framework, the EU exerts its
power not through conventional normative, military, or coercive instruments, but rather through the
deliberate externalization of its internal market rules, fundamentally making the EU’s existence a
large, regulated market with significant institutional features and competing interest groups (Damro,
2012), The massive scale of the EU’s single market forces outside countries to choose: align their
domestic regulations with EU standards, or risk losing access to one of the world's most lucrative
economic zones. This creates a natural, powerful incentive for regulatory synchronization. Within
this context, DCFTAs represent the central instrument through which this specific form of
regulatory externalization is operationalized. By mandating extensive legislative approximation to
the EU acquis, these agreements effectively extend the EU’s regulatory reach into neighboring
states and institutionalize complex processes of top-down Europeanization. This involves rigorous
alignment in diverse areas such as technical standards, sanitary and phytosanitary measures,
competition policy, and public procurement (European Commission, n.d.). Consequently, DCFTAs
do not merely function to liberalize trade in a traditional sense; they seek to fundamentally reshape
the domestic economic and institutional structures of the partner countries. From this perspective,
DCFTAs can be understood as instruments of top-down Europeanization, through which the EU
seeks to induce both institutional and economic transformation in partner countries.
Regulatory alignment is theorized to facilitate structural economic transformation: by
internalizing high-level EU requirements, domestic firms not only secure entry into the single
market but are also compelled by increased competition to modernize their manufacturing and
operational processes. This dynamic should, in theory, facilitate a structural shift away from a
reliance on low-value commodities or primary goods toward the production of more diversified and
higher value-added exports. In this sense, DCFTAs are strategically designed not only to boost
aggregate trade volumes but also to induce deep-seated structural transformation. However, as
highlighted throughout the relevant literature, this transformative process is, by no means,
automatic: Smith (2005) and Hoekman (2016) emphasize that the ultimate effectiveness of EU
externalization is heavily dependent on the strength of the provided incentives and the actual
capacity of partner countries to implement demanding reforms. This limitation is further postulated
by the conditionality theory (Schimmelfennig & Sedelmeier, 2004), which posits that the
effectiveness of EU-induced reforms depends on the credibility of membership incentives. Without
such incentives, regulatory alignment is less likely to generate the deep transformation envisioned
13
by Market Power Europe. In the absence of a credible and immediate membership perspective,
domestic compliance may become partial or uneven, thereby limiting the transformative impact of
the DCFTA. Moreover, domestic political dynamics and competing geopolitical constraints may
impede the effective translation of regulatory convergence into meaningful economic modernization
(Sierra, 2011). As such, these constraints imply that the impact of DCFTAs on export structures is
far from universal; instead, the degree of structural change likely depends on specific, localized
conditions within each partner state.
Following Market Power Europe’s logic, the causal chain connecting DCFTAs to export
diversification can be described as follows: by linking preferential access to the EU single market to
extensive legislative alignment, DCFTAs require domestic firms in partner countries to comply with
EU technical, sanitary, and quality standards. On one hand, this normative compliance reduces the
costs of entering the EU market for firms that comply with it; however, on the other hand, it
increases the “non-compliance costs” for all those firms which operate in traditional industries and
have lower standards. The hypothesis coming from this trend would be that, over time, this dual
pressure will readdress investments and production capacity from a narrow set of traditional export
sectors, mostly raw materials and low-processed agricultural products, towards a vaster range of
higher-value-added sectors, that satisfy the EU market requirements. Thus, Market Power Europe
predicts that the normative depth of DCFTAs should directly translate into a structural change,
measurable in the export composition: an expansion of the export base and a corresponding decline
in export concentration.
Based on the logic of this theory, two main expectations follow, translated in the following
hypotheses. First, H1 states that, in the post-2016 period, Georgia, Moldova, and Ukraine are
expected to show a decrease in export concentration (i.e. an increase in export diversification)
relative to their own pre-treatment levels and relative to the control group, reflecting the prediction
that deep regulatory integration should produce a structural transformation. Second, H2 states that
Morocco, Tunisia, and Jordan, operating under shallower Association Agreements that do not
require comparable regulatory approximation, are expected to display no significant change in
export concentration over the same period, since the lower level of external pressure for structural
adjustment offers no equivalent incentive for diversification. The success of this transition depends
on several critical variables, most notably domestic institutional capacity. Where governance is
weak or corruption is pervasive, the implementation of reforms is often stalled, stifling any potential
for deep structural change (Emerson & Movchan, 2021; Emerson & Cenușa, 2021). Political
14
instability may also undermine policy continuity, thereby reducing the effectiveness of long-term
reform efforts, and geopolitical dynamics also play a role in shaping these outcomes. As
demonstrated by Sierra (2011), the presence of competing external actors can constrain the EU’s
local influence and affect the trajectory of domestic reforms. Additionally, pre-existing structural
economic conditions, such as the level of industrial development, quality of infrastructure, and
human capital, may limit the ability of countries to diversify their exports, even when regulatory
convergence is present. Taken together, these considerations suggest that DCFTAs are theoretically
expected to contribute to export diversification; however, the extent of this contribution may vary
considerably across cases, especially where substantial structural and institutional barriers persist.
3.2 Case selection
Having outlined the theoretical framework guiding this research, the following section
presents the process and reasoning behind the selection of the case countries included in the study.
The three Eastern Partnership countries that have implemented DCFTAs with the EU are the
central cases for this study: Georgia, Moldova and Ukraine. These are compared against three of
Southern Neighbourhood countries operating under shallower Association Agreements, specifically
Morocco, Tunisia, and Jordan. This selection is derived by a logical system, where both groups hold
formal trade and association agreements with the EU, share broadly comparable levels of economic
development, and are geographically situated within the EU's immediate neighbourhood. The
fundamental difference between the two countries' groups lies in the integration depth that their
respective agreements bring, allowing a clear contrast which is perfectly suited for isolating the
effect of DCFTAs on export structures. The treatment group consists of the three Eastern
Partnership countries that signed DCFTAs with the EU in 2014, with full provisional application
completed by 2016 (Council of the European Union, 2024). Prior to these agreements, Georgia,
Moldova, and Ukraine held Partnership and Cooperation Agreements (PCAs) with the EU,
concluded in the late 1990s, which covered basic trade relations and political dialogue but imposed
no significant regulatory alignment requirements. The Association Agreements and DCFTAs
clearly replaced the past “superficial” arrangements, representing a difference in quality of
integration, which is far more demanding (Van der Loo, 2017). It is exactly this upgrade, from
shallow PCA to deep DCFTA, that forms the treatment group and the purpose of this study. On the
other hand, the control group consists of Morocco, Tunisia, and Jordan. All three countries hold
Euro-Mediterranean Association Agreements with the EU, concluded within the same broader ENP
framework but, unlike Georgia, Moldova and Ukraine, have not signed DCFTAs (European
15
Commission, 2021). These agreements focus primarily on tariff liberalisation and trade in goods,
without the extensive regulatory approximation requirements which define DCFTAs. Morocco,
Tunisia, and Jordan are treated as a coherent group in the existing literature (Hoekman & Zarrouk,
2009) and share a common regional trade framework through the 2004 Agadir Agreement, which
committed all three to tariff elimination and regulatory harmonisation among themselves, which
strengthens the validity of the control group even more. Larger Southern Neighbourhood economies
such as Egypt were excluded on grounds of comparability, as their economic size and structural
characteristics differ substantially from those of the treatment group countries.
3.3 Data selection
The dependent variable in this study is export diversification, defined as the extent to which
a country's exports are distributed across a broad range of product categories rather than
concentrated in a narrow set of goods (Sangita, 2018). A more diversified export structure is
generally associated with greater economic resilience, reduced vulnerability to commodity price
shocks, and a higher degree of structural transformation toward complex, value-added production
(Bochorishvili & Baakashvili, 2014). It is precisely this dimension of economic modernisation that
DCFTAs are, in theory, expected to promote, making export diversification the most appropriate
outcome variable for assessing their structural impact.
However, directly measuring export diversification requires an indicator that can be
operationalised, is quantitatively precise and comparable internationally, so across all six case
countries, over the full researched period. For this purpose, the Herfindahl-Hirschman Product
Concentration Index (HHI), as reported by the World Bank World Integrated Trade Solution
(WITS) database, will be employed for this study. The HHI measures the degree to which a
country's exports are concentrated across product categories: a higher score indicates that exports
are dominated by fewer products, while a lower score reflects a more evenly distributed. and
therefore more diversified, export basket. Thus, export concentration and export diversification are
inversely linked: an increase in HHI signals a decline in diversification, while a decrease in HHI
means greater diversification. Throughout this study, HHI is used as an inverse proxy for export
diversification, following standard practice in the trade economics literature (Adarov & Havlik,
2016).
The WITS HHI is calculated at the HS6 product classification level, which means using
detailed product-level trade data classified according to the international Harmonized System,
16
allowing for precise and comparable measurement of export structure across all six countries. The
data employed were retrieved for all six case countries for the period 2010 to 2021. In this sense,
the year 2022 and the following years had to be excluded due to incomplete data coverage across
the full set of countries. Therefore, the final dataset resulted in a balanced panel of 72 country-year
observations, with each country contributing 12 annual observations. The data were downloaded,
cleaned, and analysed using R version 4.6.0, using the specialist add-on called “fixest package”
(Bergé, 2023) for panel regression estimation.
3.4 Methodology
For the purpose of this research, a difference-in-differences (DiD) design is employed,
allowing for an estimation of the effect of DCFTAs on export diversification, operationalized
through export concentration, as previously mentioned. DiD is a quasi-experimental method that
estimates the effect of a policy intervention by comparing changes over time between a treatment
group that received the intervention and a control group that did not (Angrist & Pischke, 2008). The
method has a long tradition in applied economics and political science, with Card and Krueger's
(1994) study of minimum wage effects representing its most canonical application.
The DiD estimator is defined as:
DiD = (Treatment post − Treatment pre) − (Control post − Control pre)
In this study, "pre" refers to the period 2010–2015, before the DCFTAs entered into force,
and "post" refers to 2016–2021. The treatment group comprises Georgia, Moldova, and Ukraine,
while the control group comprises Morocco, Tunisia, and Jordan. The DiD estimate captures the
change in HHI among DCFTA countries relative to the change observed among control countries
over the same period, after accounting for pre-existing trends and time-invariant country
characteristics.
Therefore, the following regression model is estimated:
HHI_it = α + β (Treated_i × Post_t) + γ_i + δ_t + ε_it
In this model, HHI_it denotes the export concentration index for country i in year t. The key
variable of interest is the interaction term Treated_i × Post_t, which equals 1 for DCFTA countries
in the post-2016 period and 0 otherwise, and whose coefficient β constitutes the DiD estimator,
which is the parameter of primary interest in this study. Country fixed effects γ_i absorb all time-
17
invariant country characteristics, such as geographical location, historical (colonial) trade relations,
and initial economic structure, while year fixed effects δ_t control for global trends affecting all
countries simultaneously, such as commodity price cycles or the disruptions caused by the COVID-
19 pandemic. Finally, ε_it represents the error term. Standard errors are clustered at the country
level to account for serial correlation within countries over time, following the recommendation of
Bertrand, Duflo and Mullainathan (2004), who demonstrate that failure to do so can lead to severely
underestimated standard errors in DiD designs.
The validity of a DiD design rests on the “parallel trends assumption”: in the absence of the
treatment, the treatment and control groups would have followed similar trajectories in the outcome
variable. This assumption cannot be tested for the post-treatment period by definition, but it can be
assessed by examining whether the two groups moved in parallel prior to the treatment (Angrist &
Pischke, 2008). Figure 1 in the following section presents the pre-treatment HHI trends for both
groups. As shown there, both groups display broadly comparable and stable levels of export
concentration between 2010 and approximately 2013, visually demonstrating the parallel trends
assumption. A slight upward divergence in the DCFTA group from 2013–2014 onwards, potentially
reflecting anticipation effects following the signing of the Association Agreements, represents a
limitation that is acknowledged in the discussion of findings. Overall, the pre-treatment evidence is
sufficiently supportive to proceed with the DiD estimation, while recognising that the small number
of countries (six in total) limits the statistical precision of the estimates (Bertrand et al., 2004).
4. Analysis
In this section, the empirical analysis addressing the research question of this thesis: “to
what extent have DCFTAs affected export diversification in Georgia, Moldova, and Ukraine relative
to Southern Neighbourhood countries with comparable EU Association Agreements?” is presented
following 4 steps. First, descriptive statistics and the visualisations of the HHI data are shown for
clarity; second, the pre-treatment trends of the two groups are examined in light of the parallel
trends assumption. Third, the results of the difference-in-differences regression are presented and
interpreted; and finally, a robustness check excluding Ukraine is discussed for precision.
Table 1 presents the summary statistics for the variables used in this study, and can be
reported in the following way: the average HHI across the full sample is 0.03 (Standard Deviation =
0.01), with values ranging from 0.01 to 0.07, with the DCFTA group displaying a higher mean and
18
greater variation than the control group, reflecting the divergence visible in the post-treatment
period.
Table 1.
Summary Statistics
Mean SD Min Max N
hhi 0.03 0.01 0.01 0.07 72
treated 0.50 0.50 0.00 1.00 72
post 0.50 0.50 0.00 1.00 72
did 0.25 0.44 0.00 1.00 72
HHI = Herfindahl-Hirschman Product Concentration Index. Source: World Bank WITS
(2024).
Table 2 disaggregates these statistics by group, showing the mean, standard deviation,
minimum and maximum HHI values separately for DCFTA countries (Georgia, Moldova, Ukraine)
and control countries (Morocco, Tunisia, Jordan).
Table 2.
HHI Summary Statistics by Group
Control Countries DCFTA Countries
Mean SD Min Max Mean SD Min Max
hhi 0.02 0.01 0.01 0.04 0.03 0.02 0.01 0.07
HHI = Herfindahl-Hirschman Product Concentration Index. Source: World Bank WITS (2024).
Before turning to the regression analysis, it is necessary to examine the raw trends in export
concentration across the two groups over the study period. As such, Figure 1 plots the average
19
Herfindahl-Hirschman Product Concentration Index (HHI) for both the DCFTA countries (Georgia,
Moldova, and Ukraine) and the control group (Morocco, Tunisia, and Jordan) from 2010 to 2021.
Figure 1.
Average HHI by Group, 2010-2021
Source: World Bank WITS (2024). Note: Dashed line indicates entry into force of DCFTAs
(2016).
Several observations emerge when analysing Figure 1: first, it is essential to note that in the
pre-treatment period (2010-2015), as in the time span before the actual entrance into force of
DCFTAs in 2016, both treatment and control group display broadly comparable and relatively
stable levels of export concentration, hovering between 0.025–0.028. This parallel movement
visually supports and confirms the parallel trends assumption, on which the DiD model is founded.
Nevertheless, it must be noted that the DCFTA group starts to slightly diverge upward from
approximately 2013–2014, coinciding with the signing of the Association Agreements: this pattern
may reflect an anticipation effect, for which economic actors began adjusting their behavior prior to
20
the formal entry into force of the agreements in 2016 (Emerson & Movchan, 2021). Even though
this slightly complicates the parallel trends assumption, the general pre-treatment tendency stays
sufficiently comparable to proceed with the DiD estimation. Second, a clear divergence between the
two groups emerges following the entry into force of DCFTAs in 2016. In fact, DCFTA countries
register a sustained and notable increase in export concentration, while the control group essentially
remains flat for the whole post-treatment period. This bifurcation marks the visual representation of
the DiD effect, and supplies preliminary evidence that the entry into force of DCFTAs is associated
with a change in export concentration among the treatment group.
In Figure 2, we can see each individual country’s tendency; this allows for a closer analysis
of country-specific dynamics within each group.
Figure 2.
Export Concentration (HHI) by Country, 2010-2021
Source: World Bank WITS (2024). Note: Dashed line indicates entry into force of DCFTAs
(2016)
As shown in Figure 2, the increase in concentration registered in the post-2016 period
among the treatment group is not uniform: Ukraine and Georgia display the most pronounced
upward trends, while Moldova has a relatively more moderate tendency. Among the control
countries, Morocco, Tunisia, and Jordan each display relatively flat trends throughout the whole
21
period, with no clear divergence around 2016: this is consistent with H2. Overall, the descriptive
evidence demonstrates that the two groups have followed roughly similar trends before 2016,
confirming the parallel trend assumption, but diverged significantly afterwards, with DCFTA
countries showing a higher concentration, and control countries remaining stable. Therefore, this
pattern contrasts the expectation stated in H1, while being consistent with H2.
Table 3.
Effect of DCFTAs on Export Concentration (HHI)
DCFTA × Post 2016 (DiD estimator) 0.011*
(0.005)
Num.Obs. 72
R2 Adj. 0.883
RMSE 0.00
* p < 0.1, ** p < 0.05, *** p < 0.01
Country and year fixed effects included. Standard errors clustered by country.
Table 3 presents the results of the difference-in-differences estimation. The DiD estimator,
so the interaction between treatment group status and the post-2016 period, is positive and
statistically significant at the 10% level (β = 0.011, SE = 0.005, p < 0.1). This indicates that DCFTA
countries experienced an increase in export concentration of approximately 0.011 HHI points
relative to the control group, following the entry into force of the agreements. Instead of promoting
diversification, these findings suggest that DCFTAs were associated with a modest but measurable
increase in export concentration among the Eastern Partnership countries. Finally, the model
includes country and year fixed effects and explains 88.3% of the variance in HHI scores (Adjusted
R² = 0.883).
22
4.1 Robustness Check
Table 4.
Effect of DCFTAs on Export Concentration (HHI) – Robustness Check
Full Sample Excl. Ukraine
DCFTA × Post 2016 (DiD
estimator)
0.011* 0.010
(0.005) (0.005)
Num.Obs. 72 60
R2 Adj. 0.883 0.879
RMSE 0.00 0.00
* p < 0.1, ** p < 0.05, *** p < 0.01
Country and year fixed effects included. Standard errors clustered by country.
As a robustness check, the analysis was repeated excluding Ukraine, whose post-2016
period was heavily affected by armed conflict and economic disruption unrelated to the DCFTA. As
shown in Table 4, the DiD coefficient remains virtually unchanged (β = 0.010, SE = 0.005),
suggesting that the results are not driven by Ukraine's specific circumstances. The slight loss of
statistical significance is attributable to the reduced sample size of five countries rather than a
change in the underlying relationship. We can therefore conclude that the stability of the coefficient
across both specifications indicates that finding a higher export concentration in DCFTA countries
23
is not due to Ukraine’s specific war circumstances after 2016; this strengthens the results and
pattern identified in this section.
5. Discussion
As seen in the previous sections, the results of this study present an outcome that is opposite to
the theoretical expectation formulated in H1. Recalling Damro (2012), Market Power Europe
predicts that DCFTAs, by subordinating access to the EU market to a wide regulatory alignment,
should incentivize national firms to elevate their production and expand in new branches of
exportation. Instead, the data indicates that, since 2016, Georgia, Moldova and Ukraine have
registered an increase, modest but statistically significant, in export concentration compared to
Morocco, Tunisia and Jordan, contrary to the diversification anticipated by H1. On the other hand,
though, the expectation that the selected Southern Neighborhood countries would not show any
significant change regarding export concentration, as stated by H2, is supported by the data reported
in Figure 2, both by the descriptive results and the actual regression. This divergence between
theory and results can be justified through the explanations coming from the examined literature.
Firstly, we can note that the result is coherent with a dynamic where exports reach more
specialization rather than diversification. This concern matches recent policy evaluations: even
though the DCFTA agreement has substantially increased trade fluxes between Ukraine and the EU
— marking a 106% increase in EU exports to Ukraine, and 92% from Ukraine to the EU, between
2015 and 2021 — Ukraine’s continued dependence on a limited range of raw materials and primary
goods exports has highlighted the need for diversification, both in export destinations and the range
of products exported (Akhvlediani, 2025). In this sense, it is relevant to mention the classical trade
theory, first developed by Adam Smith in 1776 and further confirmed by David Ricardo in 1819
(Vijayaraj & Rai, 2026), which forecasts that an improved market access encourages countries to
concentrate production in those sectors where they believe they hold a comparative advantage
(Moss, 2014). By securing a privileged access to the EU market, Georgia, Moldova and Ukraine
may have been incentivized at deepening their own specialization in the agricultural and raw
materials sectors, where they already possessed an advantage in relation to the EU, instead of
diversifying in new branches: this dynamic is substantially coherent with Hoekman’s (2016)
observation that imposing the EU acquis does not automatically generate the expected structural
results.
Secondly, the concept of integration maturity, as described by Nielsen & Šiljak (2024) and
discussed in Section 2, offers a supplementary explanation: the authors argue that, even though
24
Georgia, Moldova and Ukraine have achieved measurable progress in adjusting to the EU
standards, they have not yet reached the level of economic competitiveness necessary to fully take
advantage of the opportunities given by DCFTAs. From this perspective, this study’s results could
reflect the intermediate phase of integration, where the normative alignment happened, but the
broader structural transformation, including the export diversification, has not yet realized.
Moreover, it is essential to note that the post-treatment period (2016-2021) that was analyzed may
simply be too short, thus insufficient, to fully grasp the effects that unfold over a longer window of
time. Thirdly, the internal and geopolitical restrictions previously discussed (Sierra, 2011; Emerson
& Movchan, 2021; Emerson & Cenușa, 2021; Emerson et al., 2021), provide even more
explanations. In fact, the persistent institutional weaknesses, political instability and, specifically for
the Ukrainian case, the armed conflict, may have limited the ability of both firms and governments
to pursue the structural reforms that the DCFTAs were designed to facilitate. This follows Smith’s
(2005) broader argument that the EU’s normative power proves to be weakened if it lacks a credible
membership incentive, and might contribute to explain why the diversifies effect predicted by
Market Power Europe did not materialise as expected. Finally, in light of the discussed literature,
the comparison with the Southern Neighborhood control group is itself informative, since it
coincides with the European Commission's (2021) own evaluation, which found only limited
improvements in export diversification under the shallower Euro-Mediterranean Association
Agreements: this is consistent with the flat HHI trend observed among Morocco, Tunisia, and
Jordan. Overall, the outcomes suggest that, even though Market Power Europe correctly identifies
DCFTAs as a mechanism which is capable of producing structural changes — the treatment group
did change, while the control group did not — the actual direction of this shift differs from what the
theory predicts. This suggests the need for Market Power Europe to be sharpened: regulatory
externalization may produce structural adjustment, but it seems that whether such an adjustment
becomes diversification or specialization depends on the institutional capacity and on the pre-
existing comparative advantage; however, these factors fall outside the scope of the EU's regulatory
leverage itself. An interesting note is that this pattern is not unique to the Eastern Partnership:
similar dynamics have been observed in other regions pursuing EU integration, where foreign direct
investment has increased without being consistently directed towards sectors that are export-
oriented and aim for high-added-value, and where limited industrial bases continue to obstacle
deeper trade integration with the EU (OECD, 2025).
The takeaways we can derive from the findings are the rejection of H1 but validation of H2,
indicating that DCFTAs are associated with structural changes in the treatment group, but in the
unexpected direction of specialization rather than diversification in exports. This outcome finds its
25
best explanation in a combination of comparative advantage dynamics, insufficient integration
maturity, and persistent internal and geopolitical obstacles; these factors, which were previously
anticipated, limit the analysis and will be further discussed alongside more impactful ones.
5.1 Strengths and Limitations
This thesis makes several methodological contributions that strengthen the credibility of its
findings. First, the adoption of a difference-in-differences design with country and year fixed effects
allows for the isolation of the DCFTA effect from both countries’ characteristics that do not change
over time, and global trends affecting all countries simultaneously, offering a causal identification
strategy that is more precise than simple before-after comparisons. The inclusion of clustered
standard errors at the country level addresses natural correlation within countries over time,
following the practice in panel econometrics (Bertrand et al., 2004). Furthermore, the robustness
check excluding Ukraine confirms that the main finding is not driven by that country's specific post-
2016 geopolitical situation, lending additional credibility to the results.
Nevertheless, several limitations must be acknowledged. Firstly, the small sample size of six
countries limits significantly its statistical power, meaning that the results should be interpreted with
caution. With only six clusters, even cluster-robust standard errors may not fully correct for within-
cluster correlation (Cunningham, 2021). Secondly, the study period ends in 2021, which means that
the most recent years of DCFTA implementation, as well as the significant economic disruptions
caused by Russia's full-scale invasion of Ukraine in 2022 and the subsequent geopolitical
realignment of the region, are excluded. Thirdly, although the parallel trends assumption is broadly
supported by the pre-treatment data, the slight upward divergence, observable in the DCFTA group
from 2013-2014, introduces some uncertainty regarding its validity. Fourthly, the HHI is a single
summary measure of export concentration, which does not capture product complexity, value-added
or the quality of exported goods, all of which are equally important dimensions for assessing
structural transformation. Finally, the staggered entry into force of the three DCFTAs (Georgia and
Moldova in 2014 and Ukraine in 2016) introduces differential timing issues, which this study
addresses by using a simplified, single treatment cutoff of 2016. This is a recognised limitation
(Cunningham, 2021) that could be addressed by more advanced estimators in future research.
6. Conclusion
This thesis explores the impact of DCFTAs by addressing the research question: “to what extent
have DCFTAs promoted export diversification in Georgia, Moldova, and Ukraine relative to
26
Southern Neighbourhood countries with comparable EU Association Agreements?”. Using “Market
Power Europe” (Damro, 2012) as the theoretical framework, the study speculated that the deep
normative integration required by DCFTAs would generate a structural change measurable in the
composition of exports of the treatment group, therefore manifesting as a decreased export
concentration compared to the control group of Morocco, Tunisia and Jordan. However, the
empirical analysis proved that speculation wrong. Using a DiD model with panel data on the
Herfindahl-Hirschman Product Concentration Index from the World Bank WITS database for the
period 2010–202: the DiD estimator is positive and statistically significant (β = 0.011, p < 0.1),
indicating that after the implementation DCFTAs in 2016, Georgia, Moldova and Ukraine have
registered an increase of export concentration levels relative to the control group. Thus, H1 is
rejected, while H2, predicting no significant shift for Southern Neighborhood countries, is accepted,
supported both by descriptive data and the regression results, with Morocco, Tunisia and Jordan
showing a consistently flat HHI trend throughout the study period.
These findings carry important implications for EU external governance and trade policy. They
suggest that deep and comprehensive integration does not automatically translate into export
diversification, challenging the main assumptions of the Market Power Europe framework
regarding the EU’s influence on partner economies. Instead, deeper integration may reinforce
existing comparative advantages and specialisation patterns. This raises questions about the efficacy
of diversification benefits attributed to DCFTA’s in the short-term, and whether they depend more
on domestic industrial policies rather than trade liberalisation alone. Further research could assess
the impact of diversification benefits on longer time frames, assess which industries are responsible
for the identified concentration, or shift a greater focus towards the political and social mechanisms
linked to these results.
27
Reference List
Adarov, A., & Havlik, P. (2016). Benefits and costs of DCFTA: Evaluation of the impact on
Georgia, Moldova and Ukraine. Vienna Institute for International Economic Studies (wiiw) &
Bertelsmann Stiftung.
Akhvlediani, T. (2025). Why the EU-Ukraine DCFTA review matters – CEPS. CEPS.
https://www.ceps.eu/why-the-eu-ukraine-dcfta-review-matters/
Angrist, J. D., & Pischke, J.-S. (2008). Mostly harmless econometrics: An empiricist's companion.
Princeton University Press.
Barbé, E., & JohanssonNogués, E. (2008). The EU as a Modest “Force for Good”: The European
Neighbourhood Policy. International Affairs (Royal Institute of International Affairs 1944),
84(1), 81–96. JSTOR. https://doi.org/10.2307/25144716
Berge, L. (2023). Efficient Maximum Likelihood Estimation with Multiple Fixed-Effects. R-
Project.org. https://cran.r-project.org/web/packages/FENmlm/vignettes/FENmlm.html
Bertrand, M., Duflo, E., & Mullainathan, S. (2004). How Much Should We Trust Differences-In-
Differences Estimates? The Quarterly Journal of Economics, 119(1), 249–275.
https://doi.org/10.1162/003355304772839588
Bochorishvili, B., & Baakashvili, G. (2014). Trade Diversification: The Potential of DCFTAs to
Reduce Dependence on a Few Export Markets and Commodities – The Case of Georgia.
28
Geocase. https://geocase.ge/en/publications/1150/trade-diversification-the-potential-of-
dcftas-to-reduce-dependence-on-a-few-export-markets-and-commodities-the-case-of-georgia
Card, D., & Krueger, A. B. (1994). Minimum wages and employment: A case study of the fast-food
industry in New Jersey and Pennsylvania. American Economic Review, 84(4), 772–793.
Cunningham, S. (2021). Difference-in-Differences. In Causal Inference: The Mixtape (pp.
406–510). Yale University Press. https://doi.org/10.2307/j.ctv1c29t27.12
Damro, C. (2012). Market power Europe. Journal of European Public Policy, 19(5), 682–699.
https://www.pure.ed.ac.uk/ws/portalfiles/portal/10091990/DAMRO_2012_Market_power_E
urope.pdf
Economic Convergence Scoreboard for the Western Balkans 2025. (2025).
https://doi.org/10.1787/bc0babf3-en
Emerson, M., & CenușaD. (2021). Deepening EU-Moldovan relations: updating and upgradng in
the shadow of COVID-19. Center for European Policy Studies.
Emerson, M., Kovziridze, T., Akhvlediani, T., & Akhalaia, G. (2021). Deepening EU-Georgian
relations: updating and upgrading in the shadow of Covid-19. Centre for European Policy
Studies; Reformatics; Rowman & Littlefield International, Rowman and Littlefield (UU):
Center for European Policy Studies.
Emerson, M., & Movchan, V. (2021). Deepening EU-Ukrainian Relations. Bloomsbury Publishing
USA.
Enlargement policy and statistical cooperation – Statistics Explained – Eurostat. (2024). Europa.eu.
https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=Enlargement_policy_and_statistical_cooperation
European Commission. (2025). EU trade relations with Southern Neighbourhood. Directorate-
General for Trade. https://policy.trade.ec.europa.eu/eu-trade-relationships-country-and-
region/countries-and-regions/southern-neighbourhood_en
European Commission. (2021). Ex-post evaluation of the impact of trade chapters of the Euro
Mediterranean Association Agreements with six partners: Algeria, Egypt, Jordan, Lebanon,
Morocco and Tunisia (SWD(2021) 319 final). EUR-Lex.
29
https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=SWD:2021:319:FIN
European Commission. (n.d.). Access2Markets – EU-Ukraine Deep and Comprehensive Free Trade
Area. Trade.ec.europa.eu. https://trade.ec.europa.eu/access-to-markets/en/content/eu-
ukraine-deep-and-comprehensive-free-trade-area
Georgia Trade Indicators | WITS Data. (2023). Worldbank.org.
https://wits.worldbank.org/CountryProfile/en/Country/GEO/Year/LTST/
Hoekman, B. (2016). Deep and comprehensive free trade agreements. 371–380.
https://doi.org/10.4324/9781315691244-33
Keshelava, D., Nebulishvili, G., & Surguladze, T. (2026). Trade Diversification, Export
Complexity, and Structural Transformation in the South Caucasus and Central Asia. Free
Network. https://freepolicybriefs.org/2026/03/30/trade-diversification-export-complexity/
Missiroli, A., Batt, J., Lynch, D., Ortega, M., & Triantaphyllou, D. (2003). The EU and its changing
neighbourhoods: stabilisation, integration and partnership. In Partners and neighbours: a
CFSP for a wider Europe (pp. 9–33). European Union Institute for Security Studies
(EUISS). http://www.jstor.org/stable/resrep06939.5
Moss, D. A. (2014). An Economic Principle For Us All: Comparative Advantage. Harvard Business
School. https://www.library.hbs.edu/working-knowledge/an-economic-principle-for-us-all-
comparative-advantage
Muravska, T., & Berlin, A. (2016). Towards a New European Neighbourhood Policy (ENP): What
Benefits of the Deep and Comprehensive Free Trade Agreements (DCFTAs) for Shared
Prosperity and Security? Political and Legal Perspectives of the EU Eastern Partnership
Policy, 23–37. https://doi.org/10.1007/978-3-319-27383-9_3
Nielsen, K. L., & Dženita Šiljak. (2024). Integration Maturity of Georgia, Moldova, and Ukraine:
Has DCFTA Helped Prepare Them for the EU Accession Process? East European Politics
and Societies and Cultures. https://doi.org/10.1177/08883254231215497
Sangita, S. (2018). India’s Exports Through the Lens of Diversification. Elsevier EBooks, 21–35.
https://doi.org/10.1016/b978-0-08-102005-0.00002-2
30
