G8 leaders have begun the first full day of talks in Germany, amid divisions over tackling climate change and tense relations between Russia and the West.
Tony Blair was upbeat on possible climate change agreement
US President George W Bush again tried to defuse the row with Moscow over US plans for a missile defence shield.
Mr Bush, who is to meet Russian leader Vladimir Putin for private talks, said it was nothing to hyperventilate about.
On climate change UK PM Tony Blair said it was still possible the summit could agree on a greenhouse gases accord.
Mr Bush and Mr Blair held a breakfast meeting on Thursday ahead of the full talks.
Mr Bush insisted the US would play a full role on climate change but said any global accord would have to include key developing nations.
"Nothing is going to happen in terms of substantial reduction unless China and India participate," he said.
Mr Blair was upbeat, saying there was a "very substantial coming together" on climate change.
G8 AGENDA FOR THURSDAY
0800 GMT - Session on world economy and developing economies
1115 GMT - Working lunch on foreign policy issues including Middle East, Iran, Darfur and Kosovo
1400 GMT - Session on climate change and energy efficiency
1730 GMT - Working dinner with discussion on Doha global trade round
"It is possible that we leave this summit - I am not saying that will happen - with a commitment on the part of everyone to substantial reductions in greenhouse gas emissions by 2050," he said.
Climate change will form the afternoon debate, with German Chancellor Angela Merkel pressing for industrialised nations to increase fuel efficiency by 20% and limit the world's temperature rise to 2C.
Other key issues in the full talks will be Kosovo, missile defence and Iran's nuclear programme.
BBC diplomatic correspondent James Robbins says all G8 summits expose contentious issues but not usually so many as this one.
Russia is expected to fight plans for Kosovo to be granted a high level of independence, our correspondent says.
Mr Bush has adopted a conciliatory tone on Washington's public row with Moscow over US plans to build missile defence facilities in two former Soviet satellites, the Czech Republic and Poland.
Protesters succeeded in blocking all land access to the summit site
Mr Bush dismissed Mr Putin's threat of aiming its missiles at Europe in response, saying: "There needs to be no military response because we're not at war with Russia. Russia is not a threat."
He also sought to play down earlier criticism of Russia's record on democracy saying: "Russian society had moved a long way since the Soviet era".
Mr Bush insists that the new system is a "purely defensive measure, aimed not at Russia but at true threats".
However, Mr Putin has scoffed at US claims that the shield is designed to counter states such as North Korea and Iran.
UK Prime Minister Tony Blair said it was not in Russia's interest to have a "scratchy" relationship with Western countries.
Tensions are high outside the summit where several hundred anti-globalisation protesters have defied riot police and water cannon to try to reach the security fence surrounding the summit venue.
Some blocked roads and a railway track being used to shuttle officials to the site, cutting off all ground access to the summit for a short time.
Some 16,000 officers have been deployed to deal with what are estimated to be around 6,000 protesters.