Developing countries have been adversely affected by the global economic downturn, and the World Trade Organization (WTO) needs to be reformed, South Africa's Trade and Industry Minister Rob Davies said in Geneva on Thursday.

Addressing the WTO in the Swiss capital, Davies said, "The current economic crisis that began in the developed world has impacted on the developing countries in the form of diminished investment flows as well as the massive job losses and increased levels of poverty."

He said trade imbalances between rich and poor countries needed to be addressed but bailouts were not helping.

"The current bailout packages of several developed countries, while a necessary counter-cyclical measure, could also exacerbate existing imbalances," Davies said.

"Certain programs have the potential to impact negatively on productive investments in the developing world. It is for this reason that South Africa has supported the proposals made by Argentina and other developing countries that the WTO monitor the impact of such measures on the trade and investment of developing countries."

He said recent WTO engagements "have been dominated by unfair demands placed on major developing countries to enhance market access for the benefit of narrow commercial lobbies in parts of the developed world."

This had been done at the expense "of prioritizing the advancement of outstanding reforms that are of urgent need to developing countries, like cotton and the LDC (least developed country) package."

Davies said the current recession "is causing job losses in all countries around the world with developing countries suffering the major impact.