The Naples Summit: Seven reluctant to become eight: Berlusconi heralds new era, with G7 countries passing 'out of recession into the dawn of broadening economic expansion'

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DISCORD loomed at today's opening of the summit of the World's seven richest democracies after Silvio Berlusconi called for Russia to be made a full member - a step resisted by several of the other summit peers.

The Italian Prime Minister, who chairs his first G7 summit in Naples after only 50 days in power, declared that 'Russia is undergoing a deep change, not only politically and socially but also economically. It has signed up to Partnership for Peace with Nato and an agreement with the countries of the European Union. It will be sitting together with the other G7 countries - therefore it will be a G8.'

President Boris Yeltsin will dine tomorrow with the seven summiteers - the leaders of Britain, France, Germany, the US, Japan, Canada and Italy - and make his annual strident call for full membership. Diplomats from leading G7 countries, such as Germany and the US, have said they will deny the request again and tell him he must make do with declarations of support. 'We will tell him he has already got enough,' said a German diplomat. 'We are not ready to let Russia in.'

At a press conference on the eve of the summit - the 20th since the club was founded at Rambouillet, near Paris, in 1975 - Mr Berlusconi heralded a new era for the seven which had passed from the shadow of recession into the dawn of a broadening economic expansion. 'Today clearly there is recovery in the United States. Also in Europe, recovery has started,' he said. He contrasted the climate with last year's G7 in Tokyo, which was shrouded in gloom and overshadowed by tense negotiations on the Gatt world trade talks.

Mr Berlusconi underlined the need to take advantage of the resumption of economic growth and deregulate labour markets and curbing record jobless levels. He also stressed the importance of removing the red tape which stumped the performance of small and medium-sized businesses.

Like Germany, he also poured scorn on the idea of a rescue package for the ailing dollar, saying it was pointless to try to resist market forces which were pushing the dollar down. This highlighted the fact that the world economic summit - long criticised as pre-packaged grandstanding for politicians seeking re-election while the markets remain in mayhem - cannot fulfil the purpose for which they were created: to stabilise the world's currency market.

A key topic at the summit will be the announcement of a nuclear safety package for Ukraine. Mr Berlusconi revealed that this will be coupled by a dollars 5bn ( pounds 3.3bn) programme, proposed by President Bill Clinton and financed by the IMF and the World Bank, to transform Ukraine from a command to a market economy. The European Union has put forward a 500m ecu package to close down Chernobyl and other Ukrainian reactors, but this is conditional on the other summiteers stumping up a further dollars 1bn.

Mr Berlusconi on the other hand wants the top of the agenda to be the creation of a humanitarian task force affiliated to Nato and the UN which would be on standby for instant intervention in crises such as Rwanda.

The leaders will meet in the Palazzo Reale, an ornate marble Renaissance palace perched on the edge of the Mediterranean.

Leading article, page 15

Markets tense, page 25

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