Portugal and Spain entering the Common Market: Their industrial competitiveness revisited

Abstract

The purpose of this paper is to assess the overall position as well as the relative strength and weakness of the Iberian manufacturing industries within an enlarged Community. Earlier studies of the authors (Donges, Schatzf 1980; Donges et al., 1982) are up-dated and extended to cover the bilateral trade relations between Portugal and Spain. Following a recapitulation of the major trade patterns of the Iberian countries, we examine the nature of their specialization, both with regard to the EC and among themselves. The increased import competition, employment changes and the adjustment problems faced by the two. countries will be analysed subsequently. The paper concludes with some considerations about an overall strategy to cope with the challenges induced by the accession.