Investigation of Economic Integration of Central and Eastern European Countries

Abstract

The paper examines trade integration indicators, which could be used not only in assessing country’s economic integration but may also be useful in evaluating the possible response of an economy to shocks. In the paper, trade integration of Central and Eastern European countries (CEECs) is assessed using the set of selected indicators. The following research methods are used: the systemic, logical and comparative analysis of literature, the analysis of statistical data. The study covers 1990–2014. The results of this study show that economic integration of CEECs increased during the research period. However, such economies as Croatia, Poland and Romania remain relatively close and more dependent on domestic demand than the other CEECs. This means that these countries may be less vulnerable to external shocks but more sensitive to internal policy shocks. The CIS countries are still important trade partners of CEECs. High export and import share of CEECs to (from) the EU shows high regional but low global economic integration of CEECs. The research results show that the major trade partners of most CEECs are Germany and Russia. Therefore, changes in the economic environment of these countries should be observed very carefully in order to mitigate the effect of external shocks that could spread to the CEECs through the real channel.