Central European Free Trade Agreement

The Central European Free Trade Agreement (CEFTA) is an international trade agreement between countries mostly located in Southeastern Europe. Founded by representatives of Poland, Hungary and Czechoslovakia, CEFTA expanded to Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Moldova, Montenegro, North Macedonia, Romania, Serbia, Slovenia and the UNMIK (on behalf of Kosovo in accordance with UNSCR 1244).

Central European Free Trade Agreement (CEFTA)

Flag
Map of Europe (grey) indicating
the members of CEFTA (blue).
Working languageEnglish
Official languages
of contracting states
TypeTrade agreement
Membership
Leaders
• Chair-in-Office
Albania
• Secretary-General
Renata Vitez
Establishment
• Agreement signed
21 December 1992
Area
• Total
252,428 km2 (97,463 sq mi)
Population
• 2018 estimate
21.4 million[1]
• Density
85/km2 (220.1/sq mi)
GDP (PPP)2018 estimate
• Total
$290 billion[2]
• Per capita
$13,500
GDP (nominal)2018 estimate
• Total
$120 billion
• Per capita
$5,600
Currency
Time zoneUTC+1 / +2 (CET / EET)
• Summer (DST)
UTC+2 / +3 (CEST / EEST)

Once a participating country joins the European Union (EU), its CEFTA membership ends. As of 1 July 2013, the parties of the CEFTA agreement are: Albania, Bosnia and Herzegovina, Moldova, Montenegro, North Macedonia, Serbia and the UNMIK on behalf of Kosovo.

Members

As of 1 July 2013, the parties of the CEFTA agreement are: Albania, Bosnia and Herzegovina, Moldova, Montenegro, North Macedonia, Serbia and UNMIK (on behalf of Kosovo).

Former parties are Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania, Slovakia and Slovenia. Their CEFTA memberships ended when they became member states of the European Union (EU).

Parties of agreementJoinedLeft
 Poland19922004
 Hungary19922004
 Czechoslovakia Czech Republic (1993)19922004
 Slovakia (1993)2004
 Slovenia19962004
 Romania19972007
 Bulgaria19992007
 Croatia20032013
 North Macedonia (until 2019 Republic of Macedonia)2006—
 Albania2007—
 Bosnia and Herzegovina2007—
 Moldova2007—
 Montenegro2007—
 Serbia2007—
UNMIK (on behalf of Kosovo)2007—

Membership criteria

Former Poznań Declaration criteria:

Current criteria since Zagreb meeting in 2005:

Current members
Flag Contracting party Accession Population Area (km²) Capital GDP in millions (PPP)[3] GDP per capita (PPP)[3]
Republic of Albania 2007-01-01 2,862,427 28,748 Tirana 40.151 13,991
Bosnia and Herzegovina 2007-01-01 3,502,550 51,209 Sarajevo 40.794 14,220
Republic of Moldova 2007-01-01 3,547,539 33,843 Chişinău 27.282 7,703
Montenegro 2007-01-01 622,182 14,026 Podgorica 12.516 20,084
Republic of North Macedonia 2006-01-01 2,077,132 25,713 Skopje 34.267 16,486
Republic of Serbia 2007-01-01 6,963,764 77,474 Belgrade 137.126 19,767
() UNMIK (on behalf of Kosovo) 2007-01-01 1,795,666 10,908 Pristina 23.524 13,017[4]

History
History of CEFTA members from 1992 to 2013. All of the original members of the trade pact became members of the European Union (EU), and because of such, Southeast European nations, such as Albania, Bosnia and Herzegovina, UNMIK (on behalf of Kosovo),[a] Montenegro, and Serbia, joined in and carried the CEFTA.
  CEFTA member states
  EU member states

Original agreement

The original CEFTA agreement was signed by the Visegrád Group countries, that is by Poland, Hungary and Czech and Slovak republics (at the time parts of the Czech and Slovak Federative Republic) on 21 December 1992 in Kraków, Poland. It came into force in July 1994. Through CEFTA, participating countries hoped to mobilize efforts to integrate into Western European institutions and through this, to join European political, economic, security and legal systems, thereby consolidating democracy and free-market economics.

The agreement was amended by the agreements signed on 11 September 1995 in Brno and on 4 July 2003 in Bled.

Slovenia joined CEFTA in 1996, Romania in 1997, Bulgaria in 1999, Croatia in 2003 and North Macedonia in 2006.

2006 agreement

All of the parties of the original agreement had now joined the EU and thus left CEFTA. Therefore, it was decided to extend CEFTA to cover the rest of the Balkan states, which already had completed a matrix of bilateral free trade agreements in the framework of the Stability Pact for South Eastern Europe. On 6 April 2006, at the South East Europe Prime Ministers Summit in Bucharest, a joint declaration on expansion of CEFTA to Albania, Bosnia and Herzegovina, Moldova, Serbia, Montenegro and UNMIK (on behalf of Kosovo) was adopted.[5] Accession of Ukraine has also been discussed.[6] The new enlarged agreement was initialled on 9 November 2006 in Brussels and was signed on 19 December 2006 at the South East European Prime Ministers Summit in Bucharest.[7] The agreement went into effect on 26 July 2007 for Albania, Kosovo, Moldova, Montenegro and North Macedonia, on 22 August for Croatia, on 24 October for Serbia, and on 22 November 2007 for Bosnia and Herzegovina. The aim of the agreement was to establish a free trade zone in the region by 31 December 2010.

After the declaration of independence of Kosovo on 17 February 2008 UNMIK continued to represent Kosovo at all CEFTA meetings. At the end of 2008 Kosovo changed its customs stamps replacing UNMIK with Kosovo. This resulted in a trade blockade from Serbia and Bosnia that do not recognise the Republic of Kosovo.[8] The government in Pristina retaliated by imposing its own blockade on imports from Serbia. This led to clashes at border posts in July 2011.[9]

Relations with the European Union

All former participating countries had previously signed association agreements with the EU, so in fact CEFTA has served as a preparation for full European Union membership. Poland, the Czech Republic, Hungary, Slovakia, Slovenia joined the EU on 1 May 2004, with Bulgaria and Romania following suit on 1 January 2007. Croatia joined the EU on 1 July 2013.

Montenegro and Serbia have been undergoing EU accession talks since 2012 and 2013, whereas Albania and North Macedonia are official candidate countries of the EU.

At the EU's recommendation, the future members prepared for membership by establishing free trade areas. A large proportion of CEFTA foreign trade is with EU countries.

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See also

Notes and references

Notes
a. ^ Kosovo is the subject of a territorial dispute between the Republic of Kosovo and the Republic of Serbia. The Republic of Kosovo unilaterally declared independence on 17 February 2008, but Serbia continues to claim it as part of its own sovereign territory. The two governments began to normalise relations in 2013, as part of the 2013 Brussels Agreement. Kosovo is currently recognized as an independent state by 97 out of the 193 United Nations member states. In total, 112 UN member states recognized Kosovo at some point, of which 15 later withdrew their recognition.

References
  1. https://www.imf.org/external/pubs/ft/weo/2018/02/weodata/weorept.aspx?sy=2018&ey=2018&scsm=1&ssd=1&sort=subject&ds=.&br=1&pr1.x=90&pr1.y=18&c=914%2C962%2C921%2C943%2C963%2C942%2C967&s=NGDPD%2CPPPGDP%2CLP&grp=0&a=
  2. https://www.imf.org/external/pubs/ft/weo/2018/02/weodata/weorept.aspx?sy=2018&ey=2018&scsm=1&ssd=1&sort=subject&ds=.&br=1&pr1.x=90&pr1.y=18&c=914%2C962%2C921%2C943%2C963%2C942%2C967&s=NGDPD%2CPPPGDP%2CLP&grp=0&a=
  3. Data for 2015. International Monetary Fund, World Economic Outlook Database
  4. ( http://www.imf.org/external/pubs/ft/weo/2017/02/weodata/weorept.aspx?pr.x=43&pr.y=14&sy=2017&ey=2017&scsm=1&ssd=1&sort=country&ds=.&br=1&c=967&s=NGDPD%2CPPPGDP%2CNGDPDPC%2CPPPPC&grp=0&a= ) International Monetary Fund. Retrieved 1 April 2017.
  5. "Archived copy". Archived from the original on 2007-09-29. Retrieved 2006-06-30.CS1 maint: archived copy as title (link)
  6. Ukraine, Croatia broaden ties
  7. "Archived copy" (PDF). Archived from the original (PDF) on 2008-02-27. Retrieved 2008-04-09.CS1 maint: archived copy as title (link)
  8. GAP Policy brief #17: Kosovo and CEFTA: In or Out? March 2011
  9. "Kosovo Serbs block disputed border crossings". The Australian. 16 September 2011. Retrieved 1 November 2013.
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