Identifying Export Opportunities: Empirical Evidence from the Southern Euro Area Countries

We implement a decision support model (DSM), which leads to realistic export opportunities. We also develop a heuristic DSM for the combinatorial optimization problem. We use trade data in the four-digit SITC for the Southern Euro Area (EA) countries. We find that Italy, followed by Spain and Portugal, has the highest potential to expand exports. We identify realistic export markets for the Southern EA countries, mainly in Europe, East Asia and the Pacific, and the Middle East. The sectors with the highest prospect for exports are Manufactured goods for all Southern EA countries, followed by Machinery and transport equipment for Italy, Spain, and Portugal, and Food and live animals for Greece.