Obama heads to UK for crunch summit

US president Barack Obama was flying into the UK tonight as world leaders gathered for the crunch G20 summit to seek global agreement on tackling the recession.

As he left the US on board Air Force One, Mr Obama spoke by phone with British Prime Minister Gordon Brown about elements of the package which remain to be thrashed out if agreement is to be reached on Thursday.

The summit comes as two international organisations predicted the worst global economic downturn since the Second World War. The World Bank said the global economy will shrink by 1.7% this year while the Organisation for Economic Co-operation and Development put the expected contraction at 2.7%.

Despite intensive behind-the-scenes work by officials and a punishing diplomatic effort by the globe-trotting Brown, gaps still remain between the 20 major economies - representing 85% of world trade – attending Thursday's summit at the Excel Centre in London's Docklands.

Mr Obama's hopes for a co-ordinated "fiscal stimulus" of tax cuts and state spending to boost global demand look set to run into the sand of European opposition and resistance from central bankers, including the Bank of England's Mervyn King.

And France today indicated that President Nicolas Sarkozy may walk away from the summit if the US and UK block his demand for a stronger global financial regulator.