The leaders of top industrialised countries focused on two of the world’s main concerns on Tuesday—the stumbling global economy and climate change—amid expectations they would act to calm international markets.

The Group of Eight held exclusive meetings throughout the day at the main venue in Toyako, northern Japan, as leading emerging economies such as China and India gathered separately in the city of Sapporo.

Oil prices have hit record highs, roiling world economies, while rising food costs have triggered shortages and social unrest in Africa, South Asia and elsewhere. UN-led talks on a new climate pact, meanwhile, have stalled amid myriad disagreements.

Early in the day, US President George W. Bush and German Chancellor Angela Merkel pledged to keep working together, but progress appeared slow on a climate change consensus at the summit, characterised by a split on the issue between Europe and the US. Divisions pitted older, more established economies like those in the Group of Eight with fast rising economies like China and India.

“I’m very satisfied with the work that has gone on on the G8 documents, as regards progress on the issue of climate change, cooperation in the area of food and oil,” Merkel said after a bilateral meeting with Bush.

Bush was more terse after the meeting, not mentioning global warming but telling reporters: “We talked about a lot of common problems, and a lot of common opportunities. We talked about the need to work—continue to work together on Iran.”

On Wednesday, the leaders of these countries will be joined by eight other big-polluting “major economy” nations that are not members, including China and India, to see if a wider agreement is possible.

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