The World Trade Organisation has made headway in resolving the differences over intellectual property rights for drugs needed by developing countries to fight major diseases.

Announcing this at a World Economic Forum session on international trade on Sunday, WTO Director-General Supachai Panitchpakdi said his discussions with multinational drug companies in the past few days were very encouraging and he was close to finalising a draft agreement on that.

Post-Doha negotiations on allowing developing countries access to patented drugs needed to fight major diseases through compulsory licensing had broken down since the deadline for finalising a draft pact on it had ended on December 31, 2002.

Later, addressing a news conference, Panitchpakdi said along with South African Trade and Industry Minister Alec Erwin and former WTO director-general Peter Sutherland, he had held intensive discussions with drug companies and made progress on the coverage of drugs and diseases under the proposed formula.

The drug companies, he said, had shown some understanding.

Panitchpakdi also said before the ministerial meeting at Cancun he had decided to convene a preparatory meeting of trade secretaries of the member countries.

The meeting would thrash out the complexities of the Cancun agenda and prepare the ministers for a positive conclusion without last-minute indecisiveness, tension or hitches, he said.

Earlier addressing the WEF session, Panitchpakdi said the Cancun meeting could not fail because every country wanted trade to prosper, and any failure at Cancun was bound to retard trade growth.

"Doha also succeeded because we could not have afforded another failure like the one at Seattle," he said.

Panitchpakdi said all the eight negotiating groups had made substantial progress ahead of the Cancun meeting and that gave him hope.

Panitchpakdi's optimism, however, was in sharp contrast to the views expressed by other participants at the session. Erwin, for instance, said the Cancun meeting was a political process and the expectations should be based on this realisation.

Unilever Chairman Niall FitzGerald said the behaviour of the developed countries in recent months on fulfilling promises made in Doha did not give any scope to developing countries to have trust in the Cancun meeting.

FitzGerald also criticised Europe's lack of vision on trade-related issues.

The value of a multinational corporation was not necessarily determined by the financial markets, but by the stakeholders, which included its customers, employees and the community in which it operated, he added.

Erwin pointed out that Europe's stand on subsidies for agriculture was guided by its farmers and a final view could be taken only after hearing out those farmers.

At an earlier session on trade, Nestle Chief Peter Brabeck-Letmathe lambasted the developed world's policies on subsidies for agriculture.

In the US, farm subsidies amounted to $9,240 per cow and in Europe they were $6,190 per cow, which would allow each cow to fly first-class around the world, he said.

Columbia University Professor Jagdish Bhagwati lamented the existence of asymmetrical trade barriers that went against the poor countries.

Market access was important, but equally important was that markets should be penetrable, he said. Bhagwati said there was no reason why patent protection issues should come under the WTO.