JAPAN: July 8, 2008


TOYAKO, Japan - World leaders head into the second day of the annual G8 summit preoccupied by soaring food and oil prices and deeply divided over how to tackle climate change.


Senior officials from the Group of Eight rich nations were meeting late into the night in Japan to thrash out wording that would allow President George W. Bush on Tuesday to put aside deep misgivings and sign on to a global goal of reducing greenhouse gas emissions by the middle of the century.

Bush is under strong pressure from Japan and Europe but says he will not back a numerical target unless big polluters including China and India agree to binding commitments to curb their carbon pollution.

A face-saving statement that goes beyond last year's summit pledge in Germany to "seriously consider" cuts of 50 percent by 2050 is especially important for Japanese Prime Minister Yasuo Fukuda, who has made climate change the centrepiece of the talks.

"This is really our bottom line. I think the prime minister believes that at this summit somehow he will be able to convince President Bush to accept some kind of consensus formula," said Japanese Foreign Ministry official Kazuo Kodama.

Global warming ties into other big themes at the three-day meeting at a plush mountain-top hotel on the northern Japanese island of Hokkaido, where 21,000 police have been mobilised to protect the leaders.

UN Secretary-General Ban Ki-moon, who attended Monday's talks, said the drive to reach eight Millennium Development Goals (MDGs) set by the UN General Assembly to reduce world poverty by 2015 was being directly hampered by global warming.

He urged the G8 to send a strong political signal by setting a long-term goal of halving greenhouse gas emissions by 2050, backed by intermediate targets that would set market forces in train to reduce energy consumption.

"We tend to think of climate change as something in the future. It is not. We see now, most of all in Africa, that drought and changing weather patterns are compounding the challenges we face in attaining the MDGs," Ban said.


FOOD PRICE BURDEN

The G8 will set out its positions on climate change, aid to Africa, rising food prices and the global economy in a raft of statements due to be issued on Tuesday.

Citing a final draft of the G8 communique, Japan's Yomiuri newspaper said the leaders would highlight downside risks to the world economy and label rising food and oil prices a "serious threat".

Italian Prime Minister Silvio Berlusconi raised the spectre that oil, which hit a record high of US$145.85 a barrel last week, could keep climbing and renewed Italy's call for higher margin requirements on futures markets to deter speculative buyers.

"There are fears oil prices could increase further. Some people fear they could reach US$200," Berlusconi told reporters.

Higher prices are taking a particularly heavy toll on the world's poor. A World Bank study issued last week said up to 105 million people could drop below the poverty line due to the leap in food prices, including 30 million in Africa.

"How we respond to this double jeopardy of soaring food and oil prices is a test of the global system's commitment to help the most vulnerable," World Bank President Robert Zoellick said.

"It is a test we cannot afford to fail," he told reporters.

To help cushion the blow, officials said the G8 would unveil a series of measures to help Africa, especially its farmers, and would affirm its commitment to double aid to the world's poorest continent to US$25 billion a year by 2010.


ZIMBABWE

The need to honour past aid pledges to Africa was a recurring refrain at Monday's talks. But activists were sceptical about the G8's warm words.

"We need to be asking ourselves why the G8 is not delivering their commitments," said Caroline Towers Kayira from ActionAid, an advocacy group.

Kumi Naidoo with Global Call to Action Against Poverty added: "We are not seeking charity from G8, but we are seeking justice from G8."

Leaders are also due on Tuesday to finalise a statement on the political crisis in Zimbabwe after a violent election that extended President Robert Mugabe's 28-year rule.

Mugabe was the only candidate in the June 27 run-off vote after opposition leader Morgan Tsvangirai pulled out citing state-sponsored violence against his party.

G8 leaders slammed the poll on Monday. Bush called it a sham, while German Chancellor Angela Merkel called it illegitimate and said she would back more sanctions.

"There's growing support for sanctions against the Mugabe regime being stepped up," British Prime Minister Gordon Brown told reporters. But Berlusconi said he preferred a deal between Mugabe and the opposition.

The summit wraps up on Wednesday with a Major Economies Meeting comprising the G8 and eight other big greenhouse gas-emitting countries, including India and China and Australia. (Editing by Rodney Joyce)


Story by Linda Sieg and Alan Wheatley


REUTERS NEWS SERVICE