Syria crisis set to overshadow G20 talks

St Petersburg: US President Barack Obama faced growing pressure from world leaders today not to launch military strikes in Syria at a summit on the global economy that was hijacked by the conflict.

The Group of 20 (G20) developed and developing economies met in St Petersburg to try and forge a united front on how to revive economic growth, but failed to heal divisions over a US plan to wind down a programme to stimulate the world economy.

The club that accounts for two thirds of the world's population and 90 percent of its output looked as divided over therapy for the economy as it is over possible military action following a chemical weapons attack in Syria.

Obama arrived in Russia's former imperial capital with a showdown looming at a dinner hosted by President Vladimir Putin, with a debate on Syria the main course on the menu.

Obama wore a stiff smile as he approached Putin and grasped his hand. Putin also wore a businesslike expression and it was only when they turned to pose for photographers that Obama broke into a broader grin. There was no clutching of arms or hugs.

The first round at the summit went to Putin, as China, the European Union, the BRICS emerging economies and Pope Francis - in a letter - warned of the dangers of military intervention without the approval of the UN Security Council.

"Military action would have a negative impact on the global economy, especially on the oil price - it will cause a hike in the oil price," Chinese Vice Finance Minister Zhu Guangyao said.

The BRICS - Brazil, Russia, India, China and South Africa - echoed that remark, and the Pope, who leads the world's 1.2 billion Roman Catholics, urged the G20 leaders to "lay aside the futile pursuit of a military solution".

European Union leaders described the August 21 attack near Damascus, which killed up to 1,400 people, as "abhorrent" but said: "There is no military solution to the Syrian conflict."

Obama is unlikely to be deterred. He said before talks with Japan's prime minister on the sidelines of the summit that the use of chemical arms in Syria was "not only a tragedy but also a violation of international law that must be addressed."

Aides said he would set out his views at the leaders' dinner and hoped to build support for military action, although aides acknowledge a consensus might be hard to find.

"We would not anticipate every member of the G20 agreeing about the way forward in Syria, particularly given the Russian position over many, many months now in terms of resisting efforts to hold the Assad regime accountable," said White House deputy national security adviser Ben Rhodes.

Putin was isolated on Syria at a Group of Eight meeting in June, the last big summit of world powers, but could now turn the tables on Obama, who recently likened him to a "bored kid in the back of the classroom" who slouches at meetings.

Only France, which has already said it is preparing to join U.S. military action, rallied loudly behind Obama.

"We are convinced that if there is no punishment for Mr. Assad, there will be no negotiation," French Foreign Minister Laurent Fabius said before leaving for St Petersburg.

With backing by Beijing and Moscow unlikely at the UN Security Council, where both have veto powers, Obama is seeking the approval of the US Congress instead.

Putin says rebel forces may have carried out the poison gas attack and that any military strike without Security Council approval would violate international law, a view now being supported increasingly openly by others - including countries that have usually disagreed with Moscow on Syria.

United Nations Secretary General Ban Ki-moon and UN special envoy Lakhdar Brahimi are also in St Petersburg to push for diplomacy rather than military options, and support efforts to organise an international peace conference on Syria.

Putin's press secretary, Dmitry Peskov, portrayed the "camp of supporters of a strike on Syria" as divided, and said: "It is impossible to say that very many states support the idea of a military operation."

Peskov also reiterated that the United States had failed to produce convincing proof that Assad, who is backed by Russian arms, and his forces had resorted to chemical warfare.

German Chancellor Angela Merkel saw no chance of agreement between Putin and Obama on Syria. US-Russian ties have long been strained by political differences but went into freefall when Russia harboured Edward Snowden, a former spy agency contractor who leaked details of US intelligence programmes.

Any G20 decision on Syria would not be binding but Putin would like to see a consensus to avert military action in what would be a significant - but unlikely - personal triumph.

Lack of harmony

The G20 achieved unprecedented cooperation between developed and emerging nations to stave off economic collapse during the 2009 financial crisis, but the harmony has now gone.

There are likely to be some agreements - including on measures to fight tax evasion by multinational companies - at the summit in the spectacular seafront Peterhof palace complex built on the orders of Tsar Peter the Great.

An initiative will be presented to leaders on refining regulation of the $630 trillion global market for financial derivatives - such as futures, options and swaps - to prevent a possible markets blow-up.

Steps to give the so-called 'shadow banking' sector until 2015 to comply with new global rules will also be discussed.

But consensus is proving hard to achieve among developed economies as the United States takes aggressive action to spur demand and Europe moves more slowly to let go of austerity.

Meanwhile, emerging economies in the Brics - Brazil, Russia, China and South Africa - are divided over the role of the US dollar in the world economy.

And there has been no sign of them rallying behind the fifth Brics member, India, after it called last Friday for joint currency intervention.

The International Monetary Fund will call at the meeting for strengthened global action to revitalise growth and better manage risks, an IMF document obtained by Reuters showed.

Advanced economies led by the United States will increasingly drive global growth while emerging countries are at risk of slowing, due to tighter US monetary policy, it said.

"The greatest worry may well be a prolonged period of sluggish global growth," the IMF said.

But with the United States and other advanced economies picking up speed, the IMF said it still expected global growth to accelerate in 2014 from this year, helped by the highly accommodative monetary conditions in the rich world.

Former Russian Finance Minister Alexei Kudrin also urged caution, warning of the threat posed by debt and suggesting the main problems of the global financial crisis may not have been overcome yet.

"We aren't in a recovery - we have just won a breathing space," he said.

Further friction on the fringes of the summit could be caused by Obama's plans to meet human rights activists including members of a gay rights group which staged protests against a law Putin signed banning "gay propaganda" among minors.

The law has been widely criticised in the West and is one of the areas on which Russia and the United States have fallen out as relations deteriorated this year and Obama pulled out of a meeting with Putin that would have been held on Wednesday.