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The Barcelona Declaration provides for a free‐trade area between the EU and 12 Mediterranean partners. A free‐trade agreement between the EU and Tunisia came into effect in March 1998. Others have been concluded or are being negotiated. But no free‐trade agreements have been concluded among Mediterranean partners. The emerging ‘hub‐and‐spokes’ structure will increase the EU's power to direct investment. Other shortcomings are the agreements’ exclusion of agricultural trade and the welfare costs imposed by their preferential nature. The 12‐year transition envisaged is too short for the partners to implement the investment and reforms necessary to face unimpeded competition. However, the area will succeed if the agreements’ dynamic provisions come into effect: free trade in farm products some time after 2000, mutual recognition of standards, and freer trade in services. The higher financial aid envisaged is being directed judiciously. The Euro‐Mediterranean agreements provide for their own updating when new...