Davos to focus on Brazil and US

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The Independent Online
THE BRAZIL crisis and the growing US trade deficit are expected to top the agenda at informal meetings of G7 leaders today and this weekend at the annual World Economic Forum meeting in Davos.

Officials said Gordon Brown, the Chancellor, would press Robert Rubin, the US Treasury Secretary, on the need for urgent reform of the International Monetary Fund in view of the seriousness of the Brazil crisis.

Mr Rubin plans bilateral talks with finance ministers at the Forum, including those from France and Mexico. A general, albeit private, meeting of all political leaders attending the Forum is also planned.

The Brazilian finance minister, Pedro Sampaio Malan, cancelled his visit at the last minute because of intense negotiations with the IMF.

More prosaic reasons were cited by others for non-attendance at what is widely seen as Europe's premier business networking conference. Heavy snowfalls caused extensive delays on roads approaching the Swiss Alpine resort, forcing some delegates, including US Vice-President Al Gore, to abandon plans to fly in by helicopter and use the train.

A less visible Russian presence than in previous years was blamed on growing economic disintegration in the former Soviet Union. "Davos is no longer interested in us, and we are not interested in Davos," said Russia's leading business daily, Kommersant.

Amid anxiety about the US position as spender of last resort in the world economy, Ken Courtis, chief economist and strategist with Deutsche Bank for Japan and Asia Pacific, said further interest-rate cuts and reflationary measures around the world would keep financial markets robust this year.