Economic performance of small states in the European economic area compared to larger countries

• Main Author: Xuereb, Vicky (2009)
• Format: Master Thesis
• Language: English
• Published: University of Malta 2009
• Subjects: European Union > Membership; European Economic Community countries; European Union countries; Iceland
• Online Access: https://www.um.edu.mt/library/oar/handle/123456789/79505

M.A.ISLANDS&SMALL STAT.STUD. The basic objective of this dissertation is to assess whether or not the six states that joined the EU in 2004, improved their economic performance after accession. These small states are Cyprus, Estonia, Latvia, Lithuania, Malta and Slovenia. Another objective of this dissertation is to compare the performance of these six small states within the EU-15, which are the countries that were already EU member states in 2004, with Iceland, which was a member of the EEA and not of the EU. Two periods to time namely 1999-2003 and 2004-2008 are taken to compare the performance of the small states with the EU-15 and with Iceland. Eurostat, IMF and UNDP data were used to construct the indicators. This subject is of interest because there is considerable debate as to whether it is in the interest of small countries to integrate with other larger states. In the case of Malta there was a heated debated on this issue mostly concerning sovereignty aspects. Economic aspects were also debated, with parties to this debate arguing that Malta will be disadvantaged economically as a result of opening up its markets as the Maltese economy was too small to compete internationally without a degree of protection. Similar arguments were put forward in the other small states. On the other hand, other parties argued that Malta was to benefit as a result of a single market and ass a result of the funds the EU gave to Malta to restructure and transpose the EU directives. The main conclusion of this dissertation is that the Small States that joined the EU in 2004 were not equally prepared and did not equally benefit from accession. The indicators of growth show that small states, as a group, benefited from EU accession in terms of economic growth, however this may have occurred at a cost of some instability. This conclusion is to be interpreted with caution due to the fact that the time period following accession may be too short to pass a definite judgment. N/A