Every year the world’s makers and shakers convene for several days of discussions, panel debates and other high-profile talk sessions in the Swiss Alpine resort. This year, of course was no different. But compared to 2003, when tensions were flying high in face of the upcoming war on Iraq, the atmosphere in Davos was considerably more calm. In fact, the 2,100 participants attending the five-day event have already demonstrated they are willing to focus more on peaceful negotiations, according to Klaus Schwab, founder and executive chairman of the World Economic Forum.

"This year is quite different from last year," he said. "People are more optimistic and we have more positive signs on the geopolitical front," the economics professor told a news conference at WEF headquarters in Geneva ahead of the opening session on Wednesday.

A who’s who list

The list of participants reads like a who’s who of business and political leaders. The opening address is to be given by Iranian President Mohammad Khatami, but U.S. Vice President Dick Cheney, U.N. Secretary-General Kofi Annan and Microsoft founder Bill Gates are also expected to steal a good chunk of the show.

More than 30 heads of state or government, 75 ministers, 28 religious leaders and 50 representatives from important NGO’s have been invited to the prestigious gathering, which convenes under the motto "security and prosperity equals peace."

"It is obvious, there can be no peace without justice," Schwab told reporters ahead of the conference, and added that without security there can be no return to economic prosperity. For this reason, the question of the future of Iraq is one of the most pressing at the conference, and several panel discussions will focus on it.

Rebuilding Iraq

"Establishing security and rebuilding Iraq’s government and infrastructures are turning into much bigger challenges than anticipated," the WEF accompanying publication said.

The top U.S. official in Iraq, Paul Bremer will join a discussion with Adnan Pachachi and Hoshyar Zebari of Iraq’s interim governing council on the next steps for getting the war-torn country back on its feet. "Some very important discussions on the future of Iraq" will take place in Davos, Frederic Sicre, a managing director at WEF, said at a news conference last week.

Schwab pointed out that this year’s focus on Iraq differed significantly from 2003. This year the forum is looking at reconstruction efforts, whereas last year everyone was discussing the looming war, he said.

Negotiating peace on the sidelines

But Iraq is not the only flashpoint in the world. Other regional conflicts are also placing a strain on international relations. To this end, the forum provides ample opportunity for political negotiations to take place on the sidelines.

For example, Israeli Foreign Minister Silvan Shalom will share a platform with Palestinian Foreign Minister Nabil Shaath to discuss peace moves. Pakistani President Pervez Musharraf is scheduled to speak on efforts to end nuclear-armed tensions with rival India. And Turkish Prime Minister Recep Tayyip meet up with Greek Foreign Minister George Panandreou to work on clearing differences over divided Cyprus.

For the first time in more than two decades a representative from Libya will attend the forum. The invitation to Tripoli comes as recognition for its recent move to ban weapons of mass destruction.

Focus on weak dollar

As the political situation begins to stabilize, so too does the economy. The first signs of economic recovery are already visible, said Horst Köhler, director of the International Monetary Fund, who will also be attending the Davos summit. He said the upswing will only be strong and sustainable when governments continue their effort to push forward with economic reforms.

But several discussions will focus on what could potentially slow that growth, namely the weak dollar. European political and economic officials are expected to make statements about the U.S. dollar which continues to fall against the euro. They have raised concerns that the greenback may hurt European exports and ultimately the continent’s chances for economic growth.