Trade asymmetries in the Mediterranean basin

The paper examines the evolution of European Union's trade asymmetries across the Mediterranean basin, by highlighting the impact of the 1995 Barcelona convention's free trade agreements. Asymmetry is gauged by measuring the speed of trade openness convergence paths between the Mediterranean North and South. The EU's Southern Mediterranean partners' reaction to their free trade agreements is examined with a series of convergence tests, accounting for endogeneity and instrumenting with spatial geographic matrices and geopolitical dummy variables. It is revealed that following the European Union's 1995 free trade initiatives the trade asymmetry between Middle Eastern and North African countries and their Northern counterparts becomes more asymmetric, ratifying Prebisch-Singer's empirical hypothesis.