Obama to meet Cameron at Canada's G8
Updated on 25 June 2010
As world leaders arrive in Canada for this weekend's G8 and G20 meetings, David Cameron is warming up for his first meeting with Barack Obama. But Washington Correspondent Sarah Smith says Obama may be sorry not to see Gordon Brown there.
The two men were never the best of friends. But they did agree on the need to encourage everyone to keep spending to avert the possibility of a second, or double dip, recession.
Without Brown, Obama looks far more isolated as he tries to warn everyone that America alone can't be responsible for driving global growth rates while other countries rein in their spending.
David Cameron has met Obama before – but not since he became Prime Minister.
And at this first meeting on the world stage they will have to agree to disagree.
Cameron to push economic agenda at G8
David Cameron insists the G8 summit weekend "isn't about a row over fiscal policy", as economists tell Channel 4 News tensions are running high between European leaders and the US president over economic policy.
With the unity of last year's G20 summit faltering in the face of recovery, the prime minister called on leaders to unite, and deliver, on fiscal policy.
Read more...
Cameron has already defined himself as one of Europe's principle deficit hawks – in other words one of the people Obama fears may drive the world into depression by insisting on cutting debt rather than encouraging stimulus spending
A year ago when the G8 and the G20 last met there was remarkable international accord. In the face of a terrifying global financial crisis it was much easier to get everyone to agree on what needed to be done
One year on and international disharmony is breaking out over how to best manage the recovery from here.
In the US officials have been publically playing down the splits between themselves and Europe over whether it is time to spend or time to cut.
But Obama has written to fellow leaders warning them that recession could yet turn into depression if drastic cuts to public spending mean too much money is taken out of the economy too quickly.
So they will not have been too pleased inside the White House as they digested the details of George Osborne’s austerity budget.
The US can't stimulate global growth all by itself is the message from Washington. If other countries concentrate on cutting deficits rather than pumping money into their economies to stimulate growth and confidence then everyone could suffer.
But in Europe the Greek debt crisis feels much closer than the melt downs on Wall St that threatened the global financial architecture 18 months ago
German Chancellor Angela Merkel will staunchly defend her plans to cut German deficits by 80bn euros over 4 years - convinced that the European debt crisis is the biggest threat to the global economy. Arguing that borrowing can’t sustain growth and deficit spending can’t be allowed to become a permanent state of affairs.
And David Cameron calling himself the “new kid on the block” will be standing right alongside Merkel – one of the most established players
Another change in the UK position will be on commitments to international aid.
Gordon Brown took great pride – particularly when the G8 was held in the UK at Gleneagles in 2005 – in dragging other world leaders toward big promises to relieve poverty and deliver more aid to the developing world.
David Cameron takes a much more cynical stance. Saying these summits need to be about "more than big talk."
In an article he has written for the Canadian newspaper The Globe and Mail he warns that summits often fail to live up to their hype.
Saying "Somehow, those intentions rarely seem to come to fruition in real, tangible global action," Cameron wrote.
"When we meet again a year later, we find things haven't really moved on. So the challenge for the upcoming G8 and G-20 is to be more than just grand talking shops."
One year ago – when the US and Europe were in much closer agreement – it seemed difficult to imagine that the Chinese could be persuaded to stop artificially manipulating their currency.
But they have just announced plans to make the Yuan or Renminbi more flexible and break its strict peg to the dollar.
That move has fended off market fears of a possible trade war between China and America.
The Yuan isn’t moving much but its moving a bit - and will make for much more friendly relations between Obama and Chinese premier Hu Jin Tao when they meet in Canada. Just when Obama needs a new friend.
