Free trade agreements of the Republic of Moldova - achievements and prospects

INTRODUCTION

Actuality. Under the conditions of actual phenomenon of trade liberalization and globalization, a Free Trade Agreement (FTA) has become a primary instrument in supporting and developing and expanding the global trade liberalization. High quality, comprehensive FTAs can play an important role in supporting global trade liberalisation through the process of economic integration and are explicitly allowed for under the World Trade Organization (WTO) rules. As since 26th July 2001 Republic of Moldova has become a full member of WTO, the FTAs negotiations became indispensable to accomplish the WTO goal of liberalization of trade in goods and services by dismantling barriers and introduction of new rules in trade-related areas. Another important argument to support the actuality of this theme is the recently signed in 2014 the Association Agreement (AA) between European Union and Republic of Moldova that involves the gradual liberalization (up to 10 years upon signature) of trade in goods and services, free movement of labour, reduction of customs duties, non-tariff technical barriers and abolition of quantitative restrictions and harmonization of Moldovan legislation to the EU acquis.

The aim and objectives. Therefore, by consulting the different national and international documents, literature and media source, the project was initiated on this theme in order to analyse the evolution and actual situation of the Republic of Moldova in building strong external trade relations. This mean that the aim of this project is to make a country’s trade relations overview based on FTAs and to assess what are the real results in accomplishing the country’s trade liberalization along with the actual stage of economic integration and what expectations shall we have. First objective will concentrate on presenting the essence and importance of FTAs from the perspective of the economic integration. Following, one of the objectives will constitute the analysis of Moldova’s external trade evolution under the first effects and influences of the last concluded FTAs. Considering the project’s aim, the last objectives will concern the stage of European integration at which Republic of Moldova is found at the moment and what are supposed to be the expected outcomes for the external trade sector.

The investigated object and the topic researched. The project represents a research on the FTA as a main instrument for trade liberalization and integration in the world economy of a country, based on the example of Republic of Moldova. In addition, the emphasis will be put on the study of Moldova’s relations with the EU and its achievements and chances for a potential regional integration.

The research methodology is based on the analysis and synthesis models, systematized analysis, method of chronological succession of economic indicators, methods of economic-mathematical tables and graphs. The project was elaborated by studying diverse works and papers from the respective domain that are considered to be a good and valuable theoretical and methodological source.

The informational basis. As investigated objects there are considered the theoretical materials concerning the integration process and the role of FTAs therein. In addition, the four FTAs that had been concluded between Moldova and its foreign partner countries, as well as their results and achievements will represent the informational basis for individual research and practical investigation.

A brief description of each chapter of the thesis. The project paper contains an introduction, 2 chapters, both divided in other 2 subchapters, conclusions, bibliography, the list of abbreviations, the list of tables and figures and annexes. The volume of the project is 32 pages excluding bibliography and annexes.

In the first chapter “Free trade agreement – primary stage of economic integration and a main instrument for globalization” is exposed the process of economic integration by describing its stages, essence, benefits and risks, and the approaches practiced by the world economists found in literature. In the second part is shown the importance and relevance of FTAs in the trade liberalization between countries and how can they open the borders for international trade.

In the second chapter “Free trade agreements of the Republic of Moldova – achievements and prospects” are treated the four FTAs that are active nowadays and whose provisions still work. In this sense, there was presented the essence of each FTA and their effects on external trade before and after their implementation. In addition, there are discussed the perspectives of Moldova’s potential further regional integration, or at least, deepening its economic cooperation with partner countries, mainly with the EU.

The quantitative description of the adjacent elements. In this report are included 3 tables and 9 figures in the basic text and