BERLIN, Nov 20 (AFP) - Group of 20 finance leaders of the most powerful rich and emerging economies began discussions here Saturday on a range of financial issues, with the question of the weak dollar and China's dollar-pegged currency expected to dominate the meeting.
After an inaugural dinner Friday night in the German capital, the delegations of the Group of Seven industrialized nations -- Britain, Canada, France, Germany, Italy, Japan and the United States, joined with those of the major emerging economies, such as China, India and Brazil, for two days of private working sessions.
Hans Eichel, finance minister of Germany, which holds the presidency of the G20 this year, reaffirmed in the meeting's opening address that a major goal of the G20 was to combat the threats against the international financial system.
"Terrorism financing, money laundering, unjust tax systems are great challenges for the international community," he said.
He said he expected "progress" at the meeting on developing the bases for "stable capital flows in the emerging countries" and a fair debt process.
The informal meeting gathers the finance ministers and central bank governors of the 20 countries.
However, four finance ministers -- of France, Japan, Russia and South Korea -- did not attend, instead sending representatives.
One member country, Argentina, was absent. The host of the meeting, Eichel, expressed irritation at the debt-burdened South American country's pullout, given that the problems of indebtedness were a main point on the agenda.
The top two US finance officials had dashed European hopes for quick relief from a weak dollar Friday hours ahead of the meeting of finance ministers and central bank governors.
US Treasury Secretary John Snow bluntly declared that the Group of 20 gathering of finance ministers and central bankers was not the place to talk about exchange rates and insisted that the main issue was how to galvanize economic growth.
Federal Reserve Chairman Alan Greenspan for his part asserted that central bank intervention had but a modest impact on exchange markets and said he saw no need for stepped up central bank coordination.
Organizers of the G20 meeting said the current strength of the euro and the slide of the dollar -- which have rattled European leaders anxious to preserve a fragile recovery -- are not on the official agenda here this weekend.
But analysts said volatility on exchange markets was likely to dominate talks on the sidelines.
Snow held a half-hour meeting early Saturday with Eichel. The two officials shook hands for a photographer and appeared relaxed.
Snow had indicated he hoped to discuss German economic growth and other issues with his counterpart, making no mention of the weak dollar that has European officials expressing increasing concern.
The US official earlier Saturday had breakfast with Mervyn King, governor of the Bank of England.
Snow had set bilateral talks on Saturday on the sidelines of the G20 with the finance ministers of Turkey, Kemal Unakitan; India, Palaniappan Chidambaram; and Indonesia, Jusuf Anwar, and with the governor of the central bank of China, Zhou Xiaochuan.
He was also to meet early Sunday with the finance minister of China, Jin Renquing.
The meeting was due to end at midday Sunday.
11/20/2004 09:32 GMT - AFP