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Friday, 1 February, 2002, 16:50 GMT
Forum gets down to business
US Secretary of State Colin Powell
US Secretary of State Colin Powell reaffirms fight against terror
Investors are watching out for pointers on the prospects for a quick upturn in the global economy as the World Economic Forum gets down to business.

They will be paying particularly close attention to two discussion panels to be held later on Friday.

The first examines the role that oil prices can play in an economic recovery, and features Saudi oil minister Ali Al-Naimi and general secretary of the Opec cartel, Ali Rodriguez.

Forum participants will also be scrutinising a second panel discussion on 'Rethinking Risk,' featuring Geoff Berardino, chief executive of beleaguered accountancy firm Andersen.

Oil's pivotal role

The price consumer countries pay for oil is a key factor in fending off the economic slowdown.

With Opec due to discuss possible further oil ouptput cuts in March, the markets will be watching closely for insights into the cartel's latest thinking.

OPEC secretary general Ali Rodriguez
Opec's Ali Rodriguez: Closely watched

High oil prices which boost business expenditure and fuel inflation are generally held to be detrimental to the health of western consumer countries.

Cheap oil is also in the interest of developing countries, except for those which are oil exporters.

Although production cuts boost Opec revenues in the short term, the recessionary impact of these price increases tend to cut overall demand for oil.

Enron affair in the spotlight

The Enron scandal is expected to be examined during much of the forum in both the scheduled events and discussions on the sidelines of meetings.

On Friday, listeners will be hoping that Mr Berardino, whose company failed to uncover a slew of hidden debts while auditing bankrupt energy trading giant Enron, will explain how the accountancy profession aims to reassure investors that its audits can be relied on.

Earlier in the day, US Secretary of State Colin Powell delivered an opening address spelling out the US' determination to defeat global terrorism.

"What we have to do as we go forward is not lose sight of the fact that we are just beginning the campaign against terrorism," he said.

The forum, now in its 32nd year, is an annual event designed to assess the health of the global economy, and identify ways of boosting growth worldwide.

Talk is likely to focus on the prospects for economic recovery.

Siemens' president and chief executive Dr Heinreich von Pierer forecasts that the growth in IT will return, but they are unlikely to see levels of growth seen at the height of the boom.

"We will not return to growth rates of 40% (for IT spending), this is unrealistic and most probably also unhealthy," he told the BBC's World Business Report.

Showbiz glamour

Normally held in the Swiss mountain resort of Davos, the forum has been moved to New York this year as a gesture of solidarity with the victims of the 11 September attacks.

Naomi Campbell
Naomi Campbell: Lending some glamour

In keeping with the glitzier location, the start of the conference was marked with a series of high-profile parties attended by celebrities including Elton John, U2 singer Bono, and supermodel Naomi Campbell.

Many of the Big Apple's trendiest restaurants and watering holes were booked this week for shindigs thrown by global corporations, including the investment banks Lehman Brothers and Goldman Sachs.

But anti-globalisation protestors failed to turn up in the anticipated numbers.

Having demonstrated peacefully on Thursday night, most protesters were sheltering from heavy rain on Friday.

 WATCH/LISTEN
 ON THIS STORY
The BBC's Nick Childs
"The meeting is overshadowed... by the events of September 11th"
UNICEF chief Carol Bellamy and singer Youssou N'Dour
"Technology can make a difference"
Howard Stringer, Sony Corporation
"The theme for the World Economic Forum ought to be when virtual worlds collide"
Dr Heinreich von Pierer, Siemens
"We will not return to growth rates of 40%"
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