How G-8 may unify around Iraq

High diplomacy will mix with Spanish moss, grits, and Southern hospitality this week when the world's eight economic and political powerhouses meet in Sea Island, Ga., to discuss everything from democracy in the Middle East to the price of a liter of gasoline in the south of France.

But probably the biggest topic will be Iraq. The US and its European allies are very close to agreeing on a UN resolution that would both allow US forces to remain in the country and give the interim Iraqi government some authority over major military actions. Such a resolution, many hope, will encourage more countries to take another key step: providing financial aid to Iraq - perhaps starting at this summit. If the US and Europe, particularly France, move closer toward resolving their differences at Sea Island, it would help heal the wounds created by the war last year.

"This is the most critical summit in a long time," says Robert Hormats, vice chairman of Goldman Sachs International. "This is an opportunity to heal some old wounds and get more of a consensus on Iraq assistance."

The progress on the United Nations resolution has come so quickly, in fact, that it might change the agenda for the summit. Last week in an advance Group of Eight briefing for the press, Condoleezza Rice, the president's national security adviser, didn't even mention Iraq. The summit, the White House said, would have three main themes: security, freedom, and prosperity.

Now with the resolution moving forward, says Mr. Hormats, who is a former member of the National Security Council, the United States will try to get everyone to agree on more foreign assistance and debt restructuring for Iraq.

Compared with last year, it could practically be a love fest. At the G-8 in Évian, France, last year, personal contact between President Bush, German Chancellor Gerhard Schröder, and French President Jacques Chirac was minimal in the wake of the Iraq invasion. "The Évian summit was successful in bringing all the leaders back on to speaking terms, but the wounds over Iraq were too fresh to permit any substantive joint action," writes Nicholas Bayne, a professor at the London School of Economics and Political Science on the website G8 Online 2004.

If progress is now made on Iraq, it might also give the leaders more interest in Mr. Bush's ideas for democratic change and economic development in the "broader Middle East and North Africa." Dr. Rice, in her briefing last week, talked about a lunch to be held at the summit with six Muslim nations: Afghanistan, Algeria, Bahrain, Jordan, Turkey, and Yemen. "This is an opportunity for the G-8 to discuss how it can support freedom and political, economic, and social progress in the Middle East," she said.

The plan drew howls of criticism from Arab leaders when it was leaked in February. In negotiations since, European diplomats have toned down the impression that reforms can be imposed from outside, and they emphasized cooperation between the G-8 and Arab partners. They have also inserted a reference to the need for a solution to the Israeli-Palestinian conflict.

European diplomats, however, have not set much store by the US-launched initiative, and are anxious not to be too closely identified with it, even in its reformed version. "Hostility to Washington is at such a pitch in the Middle East that if you want to do anything useful there, you must not tie it in any way to the United States," says Francois Heisbourg, head of the Foundation for Strategic Research in Paris.

However, the G-8 leaders are likely to endorse some less controversial ideas, such as opening public schools in Pakistan, establishing a democracy corps for the region, and educating more women. "You can't disagree with that stuff," says Charles Kupchan, a senior fellow at the Council on Foreign Relations in Washington and a former member of the National Security Council.

The leaders are also likely to agree on the need to keep trying to unearth terrorists. "There has been a lot of cooperation on fighting terrorism," says Hormats.

As the G-8 nations have done in other summits, they will also discuss Africa. On Thursday, they will have lunch with leaders from Algeria, Ghana, Nigeria, Senegal, South Africa, and Uganda. Rice says they will discuss such topics as trade, famine, and agricultural productivity, as well as HIV/AIDS.

In the past, heads of state spent much time discussing economic issues. This was the original aim when the events started 30 years ago, during another spike in oil prices. "George Shultz was Treasury secretary, and he said economics have an even more important role in the world today in fashioning our lives and directions and political values," recalls Stephen Danzansky, formerly one of the "sherpas" helping to negotiate the agenda. "Heads of state need to understand these issues and begin to understand the dynamics of what free markets are all about," says Mr. Danzansky, who now heads up the Mary Baker Eddy Library for the Betterment of Humanity at The First Church of Christ, Scientist, in Boston.

Although Rice didn't include economics as a discussion point this year, there will be plenty of potential topics ranging from the high price of oil to the implications of rising interest rates. The biggest issue on the transatlantic trade agenda, getting the Doha round of multilateral trade talks going again after their collapse in Cancún last year, has basically been settled: The European Union and US agreed last month to eliminate agricultural export subsidies to try to tempt developing countries back into talks.

• Peter Ford in Paris contributed to this story.