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Global leaders begin G20 summit Global leaders begin G20 summit
(11 minutes later)
Leaders of the world's largest economies have begun efforts to finalise an agreement to tackle the financial crisis gripping the globe.Leaders of the world's largest economies have begun efforts to finalise an agreement to tackle the financial crisis gripping the globe.
Extra efforts to boost economic growth will be pledged, but specific targets on government spending look unlikely. There will be a pledge to boost economic growth, but specific targets on government spending look unlikely.
New measures to tighten banking regulation are also expected including limits on bankers' pay and tax havens.New measures to tighten banking regulation are also expected including limits on bankers' pay and tax havens.
However, UK Business Secretary Lord Mandelson told the BBC there were still disagreements over a number of issues.However, UK Business Secretary Lord Mandelson told the BBC there were still disagreements over a number of issues.
"[Disagreements] persisted overnight," Lord Mandelson told the BBC News channel, particularly over levels of funding for the IMF, regulation of tax havens and measures to boost global trade."[Disagreements] persisted overnight," Lord Mandelson told the BBC News channel, particularly over levels of funding for the IMF, regulation of tax havens and measures to boost global trade.
WHAT TO LOOK FOR Stronger regulation of the financial system, including hedge funds and tax havensIncrease in IMF fund to at least $500bn (£345bn)Measures to boost tradeMore aid for developing countriesLess likely: Targets for additional stimulus spendingWHAT TO LOOK FOR Stronger regulation of the financial system, including hedge funds and tax havensIncrease in IMF fund to at least $500bn (£345bn)Measures to boost tradeMore aid for developing countriesLess likely: Targets for additional stimulus spending
It is understood that Gordon Brown wants to go further than some other leaders on these matters.It is understood that Gordon Brown wants to go further than some other leaders on these matters.
"Our Prime Minister is excessively ambitious in what he wants out of this summit," Lord Mandelson said. "A good thing too, because there's absolutely no point in people just coming here and rehearsing old arguments restating old commitments.""Our Prime Minister is excessively ambitious in what he wants out of this summit," Lord Mandelson said. "A good thing too, because there's absolutely no point in people just coming here and rehearsing old arguments restating old commitments."
The BBC's business editor Robert Peston says the danger with that approach is that the Prime Minister does not get what he wants and the summit is seen as a failure.The BBC's business editor Robert Peston says the danger with that approach is that the Prime Minister does not get what he wants and the summit is seen as a failure.
Pay wranglePay wrangle
There also appears to be disagreement over the extent of the crackdown on bankers' pay.There also appears to be disagreement over the extent of the crackdown on bankers' pay.
Senior EU officials have told the BBC's Joe Lynam that there is concern that there will not be as much emphasis on bankers' pay and bonuses as they had hoped.Senior EU officials have told the BBC's Joe Lynam that there is concern that there will not be as much emphasis on bankers' pay and bonuses as they had hoped.
An agreement in general terms stating that there should be no reward for failure is expected, but fixed terms and conditions may be much harder to agree, EU officials have told our correspondent.An agreement in general terms stating that there should be no reward for failure is expected, but fixed terms and conditions may be much harder to agree, EU officials have told our correspondent.
Outside the summit, more demonstrations are expected after protests in London's financial district on Wednesday.Outside the summit, more demonstrations are expected after protests in London's financial district on Wednesday.
One man collapsed and died at the protest, police said, and 88 arrests were made.One man collapsed and died at the protest, police said, and 88 arrests were made.
There is tight security at the Excel Centre in London's Docklands where the summit is being held.There is tight security at the Excel Centre in London's Docklands where the summit is being held.
A small group of protesters gathered earlier at the London Stock Exchange, but have since dispersed.A small group of protesters gathered earlier at the London Stock Exchange, but have since dispersed.
'Deal close''Deal close'
Leaders began the day with a working breakfast. They began to take their seats at 1045 BST to start what is expected to be four-and-a-half hours of talks.Leaders began the day with a working breakfast. They began to take their seats at 1045 BST to start what is expected to be four-and-a-half hours of talks.
Five different drafts are circulating at the summit, the AFP news agency reports, citing diplomatic sources.Five different drafts are circulating at the summit, the AFP news agency reports, citing diplomatic sources.
Currently, the leaders of the world's largest economies are expected to announce measures in the following key areas:Currently, the leaders of the world's largest economies are expected to announce measures in the following key areas:
• Financial regulation: Tighter limits on the financial system are expected, including the activities of hedge funds, which are currently unregulated investment funds.• Financial regulation: Tighter limits on the financial system are expected, including the activities of hedge funds, which are currently unregulated investment funds.
• Tax havens: New rules are likely. The UK Treasury has already confirmed it has reached an agreement with Liechtenstein over reducing secrecy on tax matters• Tax havens: New rules are likely. The UK Treasury has already confirmed it has reached an agreement with Liechtenstein over reducing secrecy on tax matters
• Fiscal stimulus: No new money will be committed. However, leaders are expected to pledge to do whatever it takes to boost their own economies and emphasise that - globally - $2tn is already being spent to tackle the global recession• Fiscal stimulus: No new money will be committed. However, leaders are expected to pledge to do whatever it takes to boost their own economies and emphasise that - globally - $2tn is already being spent to tackle the global recession
• IMF boost: More money for the International Monetary Fund, which helps countries in financial trouble. Its resources have been depleted in recent months by having to help a number of Eastern European nations• IMF boost: More money for the International Monetary Fund, which helps countries in financial trouble. Its resources have been depleted in recent months by having to help a number of Eastern European nations
• Global trade: An estimated $100bn to boost international trade, as indicated by Gordon Brown on Wednesday• Global trade: An estimated $100bn to boost international trade, as indicated by Gordon Brown on Wednesday
• Bankers: There may also be measures to clamp down on bankers' pay, news agencies report.• Bankers: There may also be measures to clamp down on bankers' pay, news agencies report.
SUMMIT SCHEDULE 0730 G20 leaders arrived at the Excel Centre, East London0830 Summit began with working breakfast1530 Closing statement by Brown1745 Obama closing press conference All times BST Flanders: Consensus emerging SUMMIT SCHEDULE 0730 G20 leaders arrived at the Excel Centre, East London0830 Summit began with working breakfast1530 Closing statement by Brown1745 Obama closing press conference All times BST Flanders: Consensus emerging
In the run-up to the summit, the main differences have been between France and Germany, who are pushing for stricter regulation of the financial system, and the UK and US, who think extra government spending would do more to ease the crisis.In the run-up to the summit, the main differences have been between France and Germany, who are pushing for stricter regulation of the financial system, and the UK and US, who think extra government spending would do more to ease the crisis.
However, European Commission President Jose Manuel Barroso told the BBC there was a real willingness amongst participants to have "a convergence" at the end of the summit.However, European Commission President Jose Manuel Barroso told the BBC there was a real willingness amongst participants to have "a convergence" at the end of the summit.
"We will have consensus around the two points that sometimes appear as differences: stimulus of the [global] economy and regulation. We need both, it is a question of credibility.""We will have consensus around the two points that sometimes appear as differences: stimulus of the [global] economy and regulation. We need both, it is a question of credibility."
French President Nicolas Sarkozy has threatened to walk out of the meeting if the G20 does not come up with concrete results. On Wednesday, Mr Sarkozy made it clear he was unhappy with the draft agreement.French President Nicolas Sarkozy has threatened to walk out of the meeting if the G20 does not come up with concrete results. On Wednesday, Mr Sarkozy made it clear he was unhappy with the draft agreement.
BBC economics editor Stephanie Flanders says the G20 is close to an agreement, with the main disputes financial rather than ideological.BBC economics editor Stephanie Flanders says the G20 is close to an agreement, with the main disputes financial rather than ideological.
Extra fundsExtra funds
Security tight for G20 summitSecurity tight for G20 summit
More money is likely to be given to the International Monetary Fund, to help developing countries in difficulty.More money is likely to be given to the International Monetary Fund, to help developing countries in difficulty.
The head of the IMF, Dominique Strauss-Kahn, told the BBC that in addition to increasing funding for his organisation, he thought dealing with banks' toxic assets - which caused the world's credit markets to freeze up - must be a priority.The head of the IMF, Dominique Strauss-Kahn, told the BBC that in addition to increasing funding for his organisation, he thought dealing with banks' toxic assets - which caused the world's credit markets to freeze up - must be a priority.
"I am worried about how the balance sheets are going to be cleared up, this cleansing of the balance sheet is the problem we really need to address now.""I am worried about how the balance sheets are going to be cleared up, this cleansing of the balance sheet is the problem we really need to address now."
The summit is expected to push for closer supervision of hedge funds, private equity firms and derivatives trading. Tax havens are also likely to be targeted.The summit is expected to push for closer supervision of hedge funds, private equity firms and derivatives trading. Tax havens are also likely to be targeted.
'Balancing act''Balancing act'
Leaders will release the final communiqué, which outlines their agreement, at around 1530 BST.Leaders will release the final communiqué, which outlines their agreement, at around 1530 BST.
"This is by no means the end of the process", BBC chief economics correspondent Hugh Pym warns. "The G20 will need to meet again.""This is by no means the end of the process", BBC chief economics correspondent Hugh Pym warns. "The G20 will need to meet again."
He says the leaders will have a difficult balancing act in presenting the final agreements later on Thursday.He says the leaders will have a difficult balancing act in presenting the final agreements later on Thursday.
There will have to be a bit of pragmatism over what can and cannot be achieved, our correspondent says, but they must also convey a sense that they really have a vision as to how they can bring economies through this recession.There will have to be a bit of pragmatism over what can and cannot be achieved, our correspondent says, but they must also convey a sense that they really have a vision as to how they can bring economies through this recession.
The recession has worsened since G20 leaders met last November in Washington.The recession has worsened since G20 leaders met last November in Washington.
Both the IMF and the World Bank expect the world economy to shrink for the first time in decades this year.Both the IMF and the World Bank expect the world economy to shrink for the first time in decades this year.
Reporting from from the Excel Centre, BBC business correspondent John Moylan said the summit would be judged a success if the global recession became a short, sharp shock, rather than a very long downturn.Reporting from from the Excel Centre, BBC business correspondent John Moylan said the summit would be judged a success if the global recession became a short, sharp shock, rather than a very long downturn.
The G20 group of nations is made up of the world's most powerful economies, accounting for 90% of the world's economic output, 80% of world trade and two-thirds of the world's population.The G20 group of nations is made up of the world's most powerful economies, accounting for 90% of the world's economic output, 80% of world trade and two-thirds of the world's population.