EVIAN, France(AFP) - Leaders from G8 industrialised countries, who are due to consider ways o0f encouraging a recovery of world growth, will try to radiate confidence without highlighting divisive subjects such as the fall of the dollar.
French President Jacques Chirac, who is hosting the meeting, said: "I am convinced that Evian can send a message of confidence over growth of the world economy."
Time is pressing. The economies of the G8 countries -- Britain, Canada, France, Germany, Italy, Russia, the United States and Japan -- are hesitant even though the war in Iraq is over and the price of oil has eased.
However, such statements at the summit, intended to bolster confidence, are likely to leave financial markets disappointed for they are concerned mainly about the slump of the dollar.
On Wednesday the spokesman for the French president, Catherine Colonna, recalled that Chirac had told the Financial Times newspaper on Monday that he did not think the currency situation merited any specific comment.
Colonna commented: "A few years of observation have shown that on this subject (foreign exchange rates), public statements must be weighed carefully."
The prospects of recovery of the Japanese economy, and in the euro zone, based on foreign demand, are narrowing with the fall of the dollar which appears to be encouraged by the US authorities.
Passing reference might be made to the dollar as a way of playing down the matter.
"I will reiterate our strong dollar policy and I will listen to their (G8) plans and initiatives to reform their economies," US President George W. Bush said on Thursday.
Finance ministers from G8 countries have gone through most of the economic subjects to prepare for the summit, concluding merely that structural reforms are needed. They avoided talk of the dollar at their meeting two weeks ago in Deauville, north France.
Meanwhile Japan goes deeper into deflation with each month that passes, deflation threatens Germany which is in recession as is The Netherlands, and growth of the Italian economy fell in the first quarter of this year.
Even the United States now seems at risk of deflation. The chairman of the US central bank, the Federal Reserve, Alan Greenspan, has warned that although the threat of deflation is small, it is sufficiently real to justify close attention and possibly even action by the bank.
Stock markets remain uncertain, businesses are reluctant to invest and consumption is showing signs of flagging.
At the summit here, each of the G8 leaders is expected to assure the others about policies.
Bush has said he will press his case with other leaders that "here at home we have sound monetary and fiscal policy" and that "tax cuts will help energise growth here in America".
The Europeans will continue to hope that the European Central Bank, which is to meet on interest rates on Thursday, will decide to reduce its key rate from 2.50 percent, double the key Federal Reserve rate of 1.25 percent.
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