31 country (i.e., the EU). The index is zero when either the value of exports or imports is zero, and it equals to one when exports are the same as imports.

Table 13: Horizontal Trade Specialization Indices of Major Parts in CEEC Trade with EU, 1993 & 1997

||713 pis<br>engine|ton<br> parts|759 offic<br>machin|e<br>e parts|764 telec<br>municati|om-<br>on parts|772 s<br>qear pa|witch-<br>rts<br>|784 mo<br>vehicle|tor<br>parts|821 cha<br>furnitur|irs &<br>All parts<br>e Darts|
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|Country|<br>1993|<br>1997|<br>1993|<br>1997|<br> <br>1993|<br>1997|<br>1993|<br>1997|1993|1997|1993|1997 1993 1997|
|Bulgaria|0.18|0.70|<br>0.15|0.14|<br>0.28|0.13|0.48|0.42|0.19|0.35|<br>0.41|0.81 0.36 0.47|
|Czech R.|<br>0.73|0.81|<br>0.36|0.73|<br>0.14|0.22|0.54|0.78|0.69|0.87|0.73|0.62 0.64 0.82|
|Estonia|0.06|0.02|<br>0.11|0.51|<br>0.74|0.71|0.30|0.25|0.21|0.19|0.67|0.64 0.47 0.82|
|Hungary|<br>0.16|0.27|<br>0.22|0.73|<br>0.82|0.58|0.60|0.85|0.57|0.52|0.90|0.54 0.75 0.68|
|Latvia|0.17|0.07|<br>0.01|0.14|<br>0.24|0.11|0.10|0.23|0.08|0.04|0.79|0.55 0.21 0.22|
|Lithuania|0.00|0.02|<br>0.01|0.16|<br>0.05|0.07|0.11|0.05|<br>0.05|0.02|0.97|0.52 0.07 0.15|
|Poland|0.75|0.89|<br>0.10|0.18|<br>0.14|0.24|0.56|0.55|0.25|0.28|0.69|0.65 0.49 0.46|
|Romania|0.29|0.36|<br>0.04|0.09|<br>0.03|0.04|0.39|0.33|0.34|0.88|0.67|0.43 0.27 0.54|
|Slovakia|<br>0.25|0.39|<br>0.11|0.52|<br>0.12|0.42|0.27|0.36|0.36|0.71|0.59|0.85 0.43 0.65|
|Slovenia|<br>0.79|0.75|0.51|0.44|<br>0.28|0.14|0.94|0.84|0.45|0.56|0.29|0.28 0.85 0.97|
|CEEC-1|0 0.79|0.49|<br>0.25|0.69|<br>0.42|0.33|0.58|0.68|0.44|0.53|<br>0.62|0.54 0.62 0.66|
|_Memo ite_|_ms:_||||||||||||
|Turkey|0.56|0.53|0.10|0.05|<br>0.10|0.14|0.06|0.11|0.16|0.39|0.70|0.65 0.21 0.31|
|Malaysia<br>|0.04<br>|0.29|0.43|0.10|<br>0.76|0.86|<br>0.66|0.72|0.13|0.07|<br>0.41|0.85 0.68 0.87|
|Mexico|j0.17|0.48|0.31|0.83|<br>0.07|0.47|0.26|0.41|0.25|0.14|0.04|0.77. 0.18 0.34|

Source: Computations based on EU data as reported to the UN COMTRADE database.

The values of HTS presented in Table13 have been calculated for all parts as well as separately for each of the five top components traded with the EU. These include motor vehicle parts (SITC 784), switchgear parts (772), accessories and parts for telecomununication equipment (764), office equipment parts (759) and parts of furniture (821). EU-destined exports of these product groups account for 61 percent of total exports of parts (or 9 percent of total exports of manufactures excluding chemicals to the EU). For comparative purposes, Table 13 also reports HTS indices for Turkey, Mexico vis-a-vis the United States, and Malaysia for its trade with East Asia.

By this measure, all countries (except Hungary, though its HTS index remains relatively high) have increased trade turnover in parts with the EU. Some, however, from very low levels in 1993 (Latvia and Lithuania). The largest gains recorded Estonia, Romania and Slovakia.

Slovenia-the most developed economy among CEEC-has the most active horizontal links with the EU.<sup>13</sup> The Czech Republic and Estonia rank second and Hungary third in terms of the values of the HTS index.<sup>14</sup> Except Latvia and Lithuania other CEECs have more intensive

- 3 Although its HTS for most part categories declined between 1993, the overall HTS index increased because of the increase in motor vehicle parts (784). Vehicle parts account for more than 50% of exports and 20% of imports in total parts.

- 14 The index for Hungary declined, but this may be due to its growing specializatioi **n** assembly operations at a higher level of production fragmentation. For instance, HTS index for piston engine parts fails to