Obama flies in for world economic summit

US president Barack Obama arrived in the UK today as world leaders gathered in London for the crunch G20 summit to seek global agreement on tackling the recession.

The president touched down at Stansted airport in Essex on board Air Force One before being flown by helicopter to the US ambassador’s residence in London.

As he left the US, Mr Obama spoke by phone with Prime Minister Gordon Brown about elements of the package which remain to be thrashed out if consensus is to be reached at the Excel Centre in Docklands 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 Prime Minister, gaps still remain between the 20 major economies – representing 85% of world trade – attending the summit.

Before leaving the US, Mr Obama’s spokesman Robert Gibbs said: “The president and America are going to listen in London as well as lead.”

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

Mr Brown has set out five “tests” which the G20 must meet: providing resources for the IMF and World Bank to support struggling economies; cleaning up the banking system; doing “whatever is necessary” to restore growth; resisting protectionism; and delivering low-carbon growth.

The Prime Minister’s spokesman played down suggestions that France was ready to walk out of the summit if it did not get its way.

French finance minister Christine Lagarde told the BBC that Mr Sarkozy would not sign any agreement if he felt “the deliverables are not there”.

But Mr Brown’s spokesman said the Premier had “a very constructive discussion” with the French president yesterday, adding: “We are looking forward to President Sarkozy playing a very full role in the meetings this week.”

European Commission president Jose Manuel Barroso said today he was not expecting “miracles” from the G20, but insisted the world had a “unique opportunity to re-shape globalisation”.

“The G20 will not end this crisis overnight. But it can and must make a difference,” he said.

“For the first time ever in an economic crisis, the world is working together - and not against each other. The EU is leading by example.”

More summits will be needed on the crisis, including at least one more this year, said Mr Barroso.