Economy in shadow of Syria at G8

Vladimir Putin
Vladimir Putin
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Leaders of the world’s most powerful countries are gathered in Northern Ireland today at a G8 summit set to be dominated by international division over the civil war in Syria.

David Cameron had planned for the focus of the Lough Erne summit to be the global economy, and yesterday said he hoped it would deliver agreements to “drive growth and prosperity all over the world”.

But Syria threatens to overshadow the scheduled discussions on trade, tax and transparency, after US president Barack Obama announced he was ready to begin supplying weapons to the rebels seeking to overthrow President Bashar Assad.

Mr Cameron was yesterday holding face-to-face talks with Mr Obama in Co Fermanagh, after meeting Russian president Vladimir Putin – Assad’s most important international backer – at Downing Street on Saturday.

Mr Putin has made clear his opposition to Western nations arming the Syrian opposition, and has voiced scepticism about Mr Obama’s claim that Assad has crossed a “red line” by using chemical weapons against his own people.

While Britain was a driving force behind the lifting of EU arms sanctions against the rebels, Mr Cameron insists no decision has yet been taken on whether the UK will send weapons.

Before the formal opening of the summit yesterday, Mr Cameron hoped to take advantage of Mr Obama’s visit to launch negotiations on an EU/US free trade deal .

The Prime Minister said a successful deal could “turbo-charge the trans-Atlantic economy” and be worth £10bn to the UK.

The final obstacle to opening talks on the trade pact – dubbed an “economic Nato” – were overcome on Friday, when EU nations meeting in Luxembourg agreed a “mandate” for European negotiators. Agreement had been delayed by French insistence on protections for its film, TV and music industries from US imports.

The Prime Minister and Mr Obama were meeting with EU members of the G8 – German chancellor Angela Merkel, French president Francois Hollande, Italian prime minister Enrico Letta and the presidents of the European Commission and Council to get negotiations under way.

Formal talks yesterday focused on the global economy, before a working dinner at which the leaders of the G8 nations – the UK, US, France, Italy, Germany, Canada, Japan and Russia – discussed the situations in Syria and Libya.

Today, attention will shift to counter-terrorism – including Mr Cameron’s proposals for a block on states paying ransoms for their kidnapped citizens – and action against tax havens.

The Prime Minister’s tax transparency agenda was boosted at the weekend when 10 British overseas territories and crown dependencies agreed to sign up to scheme to share tax information.

Mr Cameron said the agreement would add momentum to the drive to crack down on tax evasion by showing other G8 leaders that Britain was “getting our own house in order”.

Looking ahead to the two-day summit, the first hosted by the UK since Gleneagles in 2005, Mr Cameron said: “I am determined to use this opportunity to address some of the biggest issues facing our countries.

“First, by discussing them frankly amongst ourselves – that has always been one of the strengths of the G8. And then by agreeing practical action which will make a difference for our own peoples, and for the wider world.

“I want a meeting where we can look each other in the eye, cut through the obstacles and the opposition and generate the political will to solve the problems we face.”