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The paper aims to analyse the effects in the trade performance of Georgia and Moldova in light of the Deep and Comprehensive Free Trade Area (DCFTA) agreements with the EU. Hence, data for the period 2010-2019 is analysed to reveal the latest developments in the trade performance of these countries. The conducted analysis points to some positive developments in the trade of Georgia and Moldova with the EU for 2015-2019, however, compared to 2010-2014 or pre-DCFTA period the average annual growth rate of exports of both countries declined. Moreover, Georgia’s success to increase exports to the EU remain relatively modest as compared to Moldova. Therefore, Moldova has achieved more deep trade integration with the EU than Georgia. Furthermore, the effect of DCFTAs on trade relations between Georgia and Moldova is not substantial, and therefore, increased economic integration between the EU associated countries is not yet evident.

EU-Georgia Association Agreement (AA), with its integral part on Deep and Comprehensive Free Trade Area (DCFTA), has been regarded as the best opportunity for Georgia to promote exports to the EU and increase investment attractiveness of the country. Georgia’s benefits from AA/DCFTA directly depend on consistency of reforms as well as on the speed and degree of legal approximation and regulatory convergence with the EU, which would support growth of Georgia’s exports to the EU as well as attractiveness of Georgia for investments from the EU member states. However, after 5 years since the provisional application positive effects of the Association Agreement on trade and investment performance are not significant. As conducted study demonstrates, despite some encouraging developments in the EU-Georgia trade relations after enactment of the Association Agreement, in 2015-2018 (post-AA/DCFTA period) annual average growth rates of Georgia’s exports to the EU and investments from the EU countries to Georgia compared to 2011-2014 (pre-AA/DCFTA period) decreased. It is clear, that already achieved progress in implementation of the Association Agreement is not sufficient for export and investment promotion and Georgia should continue reforms in all areas, envisaged by the Association Agreement. Moreover, it is high time to grant Georgia the EU membership perspective and/or advance Georgia towards membership of the European Economic Area (EEA), which will be additional incentive for the effective implementation of the European Integration related reforms.

The paper aims to analyse the effects in the trade performance of Georgia and Moldova in light of the Deep and Comprehensive Free Trade Area (DCFTA) agreements with the EU. Hence, data for the period 2010-2019 is analysed to reveal the latest developments in the trade performance of these countries. The conducted analysis points to some positive developments in the trade of Georgia and Moldova with the EU for 2015-2019, however, compared to 2010-2014 or pre-DCFTA period the average annual growth rate of exports of both countries declined. Moreover, Georgia's success to increase exports to the EU remain relatively modest as compared to Moldova. Therefore, Moldova has achieved more deep trade integration with the EU than Georgia. Furthermore, the effect of DCFTAs on trade relations between Georgia and Moldova is not substantial, and therefore, increased economic integration between the EU associated countries is not yet evident. [ABSTRACT FROM AUTHOR]