Linkages between Agriculture, Trade and the Environment in the Context of the European Union Accession

This paper analyses the impact of trade on environment in Romania using a partial equilibrium model of bilateral trade in beef between Romania and the EU. We use a recursive dynamic model to analyse beef production and trade and adjust it as to include a component to evaluate the impact of liberalised trade due to Romania’s accession to the EU on groundwater and air quality. The environmental module of the model associates the pollution to the use of production inputs. We link the use of itrogen inputs (e.g., nitrogenous fertilisers, manure) to nitrogen loss through leaching/runoff into groundwater (nitrates) and greenhouse gases (emissions of nitrous oxide and methane). We compute the nitrogen loss through leaching/runoff into the groundwater based on the nitrogen balance and the greenhouse gases emissions as a function of applied nitrogen and the number of beef cattle. We consider two scenarios for the non-accession and accession case, produced a market outlook throughout the year 2011 based on assumptions regarding full trade liberalisation between the EU and Romania and income change in Romania and analysed the impact on environment. The increase in beef imports in the accession scenario at a higher rate than in the baseline scenario corresponds to a decrease in the groundwater and air pollution caused by cattle production.