The first round of negotiations between the countries of Eastern and Southern Africa (ESA) and the European Union (EU) for an Economic Partnership Agreement (EPA) started in a convivial atmosphere. European Commissioner for Development, Pascal Lamy, set the tone by expressing his ?personal sympathy to the claims by small island economies for special and differential treatment? during his press conference and the annual dinner of the Chamber of Commerce and Industry (CCI).

?The main goal of the economic partnership is to attain regional integration in those countries.? Pascal Lamy explained that those negotiations are meant to improve and facilitate business between ESA countries and EU.

However, they should, above all, help to open trade among the 16 ESA countries. He insisted on the fact that EU will not invade ESA markets region through the EPA. The region would open gradually to EU countries after the negotiations in 2008.

40% of the region?s exports are already absorbed by Europe, which proves ?opening trade vis-à-vis European Union will occur, but slowly?.

A road map has been set up during the sessions to attend to the more urgent: a regional market for trade to take part in sustainable development. Minister of Foreign affairs, Regional trade and Regional cooperation, Jayen Cuttaree, said this notion of ?sustainable development is at the heart of the process of negotiations?.

Regional economic and social integration seem to be the commissioner?s key words. According to him, this must help face international competitiveness. EU has already voted 700 million euros for trade-related and technical assistance.

As guest speaker at CCI dinner, Pascal Lamy insisted on small island economies, and particularly Mauritius. He explained that small islands have to ?fight remoteness, infrastructure costs and resource restraints?. So regional integration in the Indian Ocean is an ?obvious solution to lighten natural disadvantages?.

He reassured the Prime Minister, Paul Bérenger, that ?World Trade Organisation (WTO) has to take into account the specificity of small economies and economies of islands?. The PM had declared earlier that globalisation did not benefit small economies.

The commissioner emphasized the important role that EU plays in the Mauritian economy with preferential access to products like sugar. It is our most important market accounting for more than two thirds of our exports. However, he did not try to conceal that preferences like sugar and tuna were under pressure.

Speaking of sugar particularly, he pointed out the coming changes: ?For sure, this will change. Reform of the EU as far as the sugar protocol is concerned will change part of your competitive landscape.? He nevertheless added that this will not happen too quickly to prepare ESA economies to this major change.

The commissioner knows that the end of the quota regime for textile and clothing as well as the threat from China, are ?a lot of headache? for Mauritius. But he expressed his confidence in the country?s future as ?Mauritius has a track record?. He advised on a restructuring scheme for sugar rather than for textile.

He finally expressed his joy of working in Mauritius, ?There is something stimulating in Mauritius: the proactive and hands-on approach on everything you do here?. The European Commissioner is optimistic as far as the future of Mauritius is concerned, despite a difficult world economic context.

Minister Cuttaree and Pascal Lamy both expressed their satisfaction with the outcome of the negotiations.

The launching looks promising; both ESA countries and EU seem satisfied. The commissioner said that, by April, the agreement level that should have been attained in Cancùn should be reached. Let us hope this time will be the good one.

?There is something stimulating in Mauritius: the proactive and hands-on approach on everything you do here?.

<B>The Economic Partnership Agreement</B>

The current non-reciprocal tariff preferences that Mauritius enjoys under the Cotonou Agreement will be maintained until 31 December 2007. Starting in 2008, a set of Economic Partnership Agreements (EPA) will replace them. These free-trade agreements will be reciprocal and WTO-compatible. They will thus add predictability to the relationship between ACP and EU countries.The ESA region has opted to negotiate in six clusters: Development issues, Market access, Agriculture, Fisheries, Trade in services and Trade-related areas.