Hamish McRae: Bono fide: it takes an outsider to speak the language of the new world-trade order

You have to hand it to Bono. His Product Red - creating a stable of products and services that give part of their profits to fight Aids in Africa - is a great idea. But there are lots of great ideas that fizzle out. His genius, the way he is approaching it, shows a keen sensitivity to the subtleties of the market.

Speaking at the World Economic Forum in Davos last week, he insisted that this was not altruism: the project has to be commercially viable. He acknowledged that some people might criticise him for working with business, but, of course, such an approach is more likely to generate a stable and growing stream of revenue that can be directed towards combating Aids than relying on purely charitable sources.

Besides, while Bono may reject altruism as a motive, the project does tap into a sense that most of us have of wanting to spend money in ways that help global society, when we have a chance to do so.

You can be cynical about this, and a number of businesses are: they hang a "green" tag on some overpriced commonplace product and tell buyers they are helping to save the rainforest.

The "ethical" investment industry needs to be approached with a certain caution, too. However, if, as has been suggested, there are some 1.5 million people in the UK who are interested in buying ethical brands, then Red should do very well. My guess is the market is larger than that.

But Bono is doing something more. He is helping to focus policy makers on the need to promote trading relationships with the developing world. We will have to wait and see whether yesterday's "mini-ministerial" meeting of trade representatives in Davos gets the Doha trade round back on track. But there is such a legacy of mistrust from these trade negotiations that it takes someone from the outside, such as Bono, to remind people that freer trade benefits both sides. There is a log-jam, and it needs to be broken.

However, it is important to set the ill temper in the context of what is actually happening in international trade. As the left-hand graph shows, there has been a surge in the proportion of world economic output generated by non-G7 nations (the largest developed countries) over the past decade. Just last week it was disclosed that the Chinese economy is now larger than that of Britain or France. On present trends, it passes Germany in three or four years' time.

This growth is driven by the success of developing country exports. The middle graph shows how, in the late 1990s, the growth of these ran at pretty much the same rate as that of the developed world. But since 2000, the rates have diverged, with the developing countries growing their exports at roughly double our rate. The poor countries are doing better than the rich.

I can think of lots of reasons why the European Union, the US and Japan should reduce or eliminate the trade restrictions they still apply, including the fact that it would be in their - our - self-interest to do so. I can think of many reasons why developing countries should be angry at how world trade can work against them. And I can think of many developing countries that are not sharing in this boom.

But the fact is that the developing world is doing better now than it has at any time since the Industrial Revolution. And that is happening not because of aid but because of trade.

There is a further point: the flows of economic resources to the developing countries do not come only from trade and aid. They also come from emigrants' remittances. The right-hand graph shows the leading five countries ranked in dollar terms. The top three should be no surprise: India, China and Mexico. But number four is intriguing: France. Why are there so many French people living abroad and sending money back? More research needed.

From a social point of view, there must be concerns about this form of financial flow, particularly if people have to leave their families to get jobs abroad and send money home. But, at best, the expat workers gain skills as well as cash - skills that can also be repatriated.

That leads to what surely is the key relevance of the work of stars such as Bono in promoting commercial activity as a way of reducing global inequities. He is pushing at an open door. We are in the middle of this huge shift of power from our world - rich Europe, North America and Japan - to the rest of the world. It is as big as the shift of power that took place in the 19th century towards the UK, continental Europe and then the US. But so much of the language of trade relations reflects the old order, not the new one.

I saw an example of that on Friday. ActionAid's comment on the Davos mini-ministerial was this: "Now is not the time for elite meetings. All members of the World Trade Organisation must come together and rethink the direction of the negotiations to put poor people's issues at the centre of the talks, as they originally promised. If they fail to do so, it will be clear from Davos that it is big business which is calling the shots."

That sort of comment not only fails to recognise the significance of the rise of India and China as economic powers but the extent to which those two countries will increasingly "call the shots". I was speaking at Lancaster University last week on the ways in which we might expect China and India to deploy their economic power, and I was asked a question that stumped me.

I had talked about how China and India would deploy power in their relations with the West. But how would they deploy it in their relations with each other? Thinking about it afterwards, that struck me as one of the half-dozen most important questions facing the world economy over the next generation. It is one over which the West has no influence. We are talking about the relationship between what will, in most of our lifetimes, become two of the world's three largest economies. That is big biscuits.

What Bono is doing reflects the fact that business can do a lot more to help tackle global social and health problems. For now, understandably, he is approaching Western businesses - the Product Red project is working with companies such as American Express and Gap. The latter's sourcing from Africa is important, as there is a real risk that Chinese exports might crowd out African textile producers.

But the next stage of engaging the global business community will surely be to get the great companies of China and India involved. They are the new powerhouses. What are their values and objectives? How best can they secure their businesses in the long term?

This is the next dialogue that needs to be opened up and it will take great communicators, such as Bono, to do so.

Do the Lib Dems need an 'Independent' leader? It's a no-brainer

"So what's he like, then?" I keep being asked.

Staunch readers of The Independent on Sunday may recall that Christopher Huhne was business editor in the early 1990s, becoming also business editor of The Independent when the two titles were merged. Before that, he was economics editor of The Guardian. He eventually left the Indy to run the emerging markets side of a bond rating agency before becoming a Liberal Democrat MEP and last summer, an MP. And now, with every day that passes, he is looking a more credible leader for the party.

The question has a certain spice, given the stuff in the papers in the past few days, and it is always difficult to write about a former close colleague and a friend. But it might be helpful, so here goes.

The first thing to be said is that he is a good and decent man. The point has been made that he has a large family but there has been less attention paid to the fact that he is married to Vicky Pryce, now the chief economist at the DTI. Vicky is also a thoroughly good thing, having not only worked as a successful economist in the City, but also helped companies to develop corporate social responsibility. Ten out of 10 there.

As far as Chris is concerned, we at the Sindy and Indy know him as a financial and economic journalist rather than as a politician. They really are different trades and it may well be that Chris is more suited to the latter: a world where people are judged by the spoken word, rather than the written one.

If there is any shadow at all, it might be one of judgement. Chris was an enthusiastic supporter of Britain's membership of the ERM, despite the damage that was doing to the economy. Lots of us made that mistake but most of us learnt from the experience of being proved wrong. Chris, however, has subsequently been a strong supporter of British membership of the euro, which is Lib-Dem policy, of course, but which does not look much of a runner now.

Judgements are judgements. The fundamental point is that this is someone who had a successful career outside politics and brings intelligence and outside knowledge to Westminster. I don't know the other candidates but I should have thought that it was a no-brainer which one to go for.