Challenges world leaders will face at the G8 summit

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President Barack Obama and British Prime Minister David Cameron outside the White House in March 2012
President Barack Obama and British Prime Minister David Cameron outside the White House in March 2012 Photo: Reuters

World leaders are gathering in Washington at the moment, ahead of the G8 Summit at Camp David tomorrow.

You might think that the charms of rustic Presidential cabins in the Catoctin Mountains would at least calm the nerves of world leaders. But the nightmare of Greece will make for a tense day and a sleepless night in the woods of Maryland.

The leaders have immediate challenges. They must show at least some unity in economic policy. They need to show people, and the markets, that they have the political focus to deal with the risk of contagion.

The wildcards are clearer than the solutions. Presidential Hollande is entirely untested as a crisis manager. President Obama is in the midst of an increasingly fraught election campaign. David Cameron is juggling a potentially awkward split on fiscal policy with Paris and Washington. Chancellor Merkel is under enormous pressure.

And there remains the truth that whatever is decided here over the next 36 hours, events in Athens and Madrid can overshadow everything.

For years, Europe promoted itself as a powerful force for good at these global summits; a beacon of fiscal virtue and a political inspiration to others. No longer. This weekend, Europe is looking desperately weak and vulnerable.