WTO on the defensive

Some explaining to do: Romano Prodi and Michael Moore

World trade leaders have gone on the defensive at the World Economic Forum in Davos, as criticism mounts of the operation of the World Trade Organisation.

Anti-globalisation protesters held a demonstration in the Swiss ski resort against what they see as the injustice of the world trade system.

The law of the jungle in trade is very dangerous for weak economies

Alec Irwin, South Africa's trade and industry minister

But former WTO and Gatt leaders, including Renato Ruggiero, Peter Sutherland and Arthur Dunkel have said the organisation is misunderstood, that the "public undermining" of the WTO has gone too far and called on national governments to "speak up for the WTO".

Current WTO chief Mike Moore said it is possible that negotiations for a fresh round of trade talks could begin this year, following the failure to start a Millennium round of trade talks in Seattle last year.

Defensive

"The most dangerous misconception - at least to the extent that it is taken seriously - is that the system amounts to a conspiracy between large multinational firms and certain governments...It is simply not true," the statement from the three former heads of the organisation said.

Moore: New round possible

"The WTO cannot be used as a Christmas tree on which to hang any and every good cause that might be secured by exercising trade power," it added.

The statement called on the WTO to launch a senior level policy consultancy group to ensure current trade issues are "debated in the widest possible context".

It agreed that "major financial commitment" should be made through the multilateral agencies to help transition economies.

With the organisation set to hold a ministerial meeting later this year, this would be the right time to launch fresh trade round, they said.

This view is shared by WTO incumbent Mike Moore.

"It is possible this year to launch a set of negotiations," Mr Moore said.

Developing discontent

But Martin Khor, director of Third World Network in Malaysia, said that many developing countries have yet to feel the benefits of the last trade round.

"I am all for a new round if the new round focuses on the workings of the WTO system," Mr Khor said, highlighting the need for reform.

South Africa's trade and industry minister Alec Irwin warned that without an international trade round, the situation might worsen for developing countries.

Delay could be "disastrous", he said.

"The law of the jungle in trade is very dangerous for weak economies," he said.

US senator John Kerry made some move to offer an olive branch to protesters, by suggesting that the new round come up with a multi-billion dollar environmental fund.

"There are huge upside benefits which have not been marketed," he said.