Regarding the EU Eastern enlargement and possible developments in the dairy sector of the new member states two different scenarios were analyzed: The first one is the process of enlargement after the Agenda 2000. The second scenario is a technological and institutional change in new member countries after their accession into the EU. The analysis is done with an extended version of the general equilibrium model GTAP (Global Trade Analysis Project). The results show that an enlargement generates only small changes within the old EU, but can have huge effects for some sectors in the CEECs. Technical progress in the raw milk sector is mainly translated into higher quota rents while technical change in dairy production results in important price and quantity effects.