Group
of Eight powers warn of energy threat to world economy
Viktor Korotayev/Reuters
Finance Ministers Karl-Heinz Grasser of Austria
(L), Peer Steinbrueck of Germany (C) and Giulio Tremonti of Italy
laugh during a photo call at a G8 Finance Ministers' meeting in
Moscow February 11, 2006.
By
David Williams
AFP
MOSCOW
Petroleumworld.com
02 13 06
Group of Eight finance chiefs wrapped up "stormy" talks
Saturday at a hotel near Red Square, warning that wild energy
prices threaten prospects for solid world economic growth in 2006.
"Overall global growth remains solid and this is expected
to continue in 2006," the G8 finance ministers said in a
final communique released after heavily guarded, closed-door talks.
"Risks remain, including high and volatile energy prices,"
the major economic powers warned.
In a bitterly cold Moscow, the Russian authorities laid on strict
security for the meeting.
Sidewalks around the hotel, overlooked by the towering spires
of the Kremlin, were blocked off to the public and guarded by
police with dogs. Army trucks were seen delivering police reinforcements.
Oil prices and energy security dominated Russia's first hosting
of G8 policymakers from Britain, Canada, France, Germany, Italy,
Japan and the United States.
High oil and gas prices have delivered a windfall to Russia, the
world's second biggest oil exporter, giving it greater economic
clout than in the past.
Russia's G8 partners were deeply concerned, however, when Moscow
turned off natural gas supplies to Ukraine in January to push
through sharply higher prices. Kiev complained the demand was
politically motivated.
"On some topics the discussions were stormy," the host,
Russian Finance Minister Alexei Kudrin, told Ria Novosti news
wire.
Asked to explain further in the closing news conference, Kudrin
said: "Of course, the discussions between the ministers are
fairly tense. It is a struggle over opinions. There is not always
a complete resolution."
As expected, there was no mention in the statement of pressure
on Russia to ratify a 1991 energy charter aimed at facilitating
gas flows across Europe and the former Soviet Union.
Moscow has given no date for ratification.
"At this point, Russia is still not ready to ratify the treaty,"
French Finance Minister Thierry Breton said. But Breton said talks
would press ahead on the treaty, which is of intense interest
to Europe.
US Treasury Secretary John Snow and other ministers smiled and
joked as they took a brief break from their talks to pose for
photographs. But the topics for discussion were grave.
Besides energy, the G8 ministers also pondered how to combat infectious
diseases, interrupt terrorist financing and inject life into bogged-down
world trade talks.
In their final communique, the G8 ministers:
-- Called for aid to developing countries battling the deadly
H5N1 strain of bird flu just days after the virus spread to Africa
for the first time. "We call on the donor community to provide
financial suppport to poor countries fighting the epidemic,"
it said.
-- Pressed for more action to spark life into World Trade Organization
negotiations aimed at opening up international trade. The ministers
called for "significant progress" in freeing trade in
agriculture, industrial products and services, including financial
services.
-- Vowed to beef up the fight against networks which finance terrorism.
"We are committed to strengthening our systems for freezing
assets, information sharing, and multilateral financial tools
to disrupt criminal and financial activities," the statement
said.
Russia's leadership of the G8 this year has thrown into relief
tensions with the West.
Critics accuse Putin of enacting policies that concentrate too
much power in the Kremlin, that curb civil society in Russia and
amount to a rollback of democratic gains since the 1991 breakup
of the Soviet Union.
Discussion of technical issues such as currency markets traditionally
addressed by G7 finance ministers were skipped to avoid insulting
the host, Russia, which is excluded from such discussions.
President Vladimir Putin told journalists on the final day that
he believed the work of the G8 "would be more efficient if
Russia took part fully, including in the G8 financial" talks.
France and Germany each backed Moscow's bid for full participation.
AFP
02 12 06
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