"Assembled in Europe" - the role of processing trade in EU export performance

According to recent analyses, processing trade represents around 50% of total Chinese exports. But processing trade is not just a feature of Chinese trade or other emerging economies. It is also one option that EU trade policy offers to interested companies, subject to a specific set of rules and procedures. If in the case of China processing trade is responsible for half of China's impressive trade performance, what is the role of processing trade in Europe? <p> This column investigates the use and role of processing trade - a trade regime credited as a key driver of Chinese export performance but largely overlooked in Europe - on the overall and sectoral EU trade performance in recent years. It argues that, despite its rather low profile in trade debates, EU exports after inward processing accounted for around 10% of total extra-EU exports in 2011. Given its non-negligible share, processing trade procedures may require further reflection on how to maximize its benefits for EU's external competitiveness.