The meeting of the Asia Pacific Economic Cooperation (APEC) forum brought together leaders from its 21 member economies on Friday, including US President George Bush, Chinese President Hu Jintao, Japanese Prime Minister Junichiro Koizumi, Mexican President Vicente Fox, Russian President Vladimir Putin and other top political figures.
The meeting's host, South Korean President Roh Moo-hyun, shook hands with each arriving leader at the Bexco conference centre where the first day of the summit was being held before the leaders headed into a closed meeting.
Thousands of demonstrators held rallies at several different locations in the port city of Pusan, chanting slogans and carrying signs reading "Get rid of APEC" and "Let's get Bush".
Tens of thousands of police and military forces have been deployed in the city against attacks and to keep protesters away from summit venues. There was no sign violence as Friday's protests got under way.
Protesters could not make it to
the conference venue in Busan
The leaders are set to endorse a statement agreed upon earlier this week by APEC ministers that aims to foster progress in World Trade Organisation talks set for next month in Hong Kong.
That statement acknowledged "considerable divergences" and said "a clear roadmap" must be established if the current so-called Doha round of WTO talks is to succeed.
In their own statement, the leaders will give their support to free trade and also express strong concern about the threats of terrorism and bird flu, according to a draft of the document seen by The Associated Press.
"Terrorism remains as a menacing threat to our world and we condemned terrorist acts that not only took thousands of lives but have also been aiming to destabilise the security of the region," the draft states.
Bird flu focus
Concerns over the possibility of a human pandemic spawned by bird flu have grown in recent days with China admitting its first human cases of the disease.
Bush is expected to make bird flu a major focus, and APEC leaders are set to agree on initiatives committing to boost their preparedness against a possible outbreak.
Bush (L) met Southeast Asian
leaders to secure US interests
On the sidelines of APEC, leaders are also holding separate meetings.
Bush met on Friday morning with Southeast Asia leaders to underscore US interest in the region and to urge they exert their influence on the military government in Myanmar. He also met with Russia's Putin.
Amid a diplomatic row over allegations Japan is glorifying its colonial past, Roh will briefly meet on Friday with Japanese leader Koizumi, who has reignited anger in South Korea and China by again visiting a shrine honouring convicted war criminals among other war dead.
On Saturday, all the leaders will conclude the APEC summit at a newly built dome-roofed villa in a dramatic location on the South Korean shore that has been named the Nurimaru house - a new Korean word meaning "pinnacle of the world," which it will become for the few hours the world leaders meet there.