Berlin  - Group of 20 (G20) finance ministers and central bankers are meeting near London Friday amid signs of renewed tensions over the action to combat the global recession and the long-term drive to tighten global market regulation.

Gathering in the neo-Jacobean splendour of the South Lodge Hotel in the rolling green hills on the outskirts of the British capital, the finance ministers from the world's leading industrial and emerging nations will also set the stage for next month's summit in London of the G20 government chiefs.

But as was the case in the runup to the last G20 leaders' summit in November in Washington, signs of friction have emerged again between the US and Europe over the European push for stricter financial regulation and the US drive for more immediate action to contain the global economic slump.

Renewed tensions between the big economic powers over tightening up financial market regulation could help to clear the way for the world's major emerging economies such as China, India and Brazil to once again play a critical role both at the weekend G20 finance ministers' meeting and next month leaders' summit.

This is especially case as the scale of the crisis gripping the global economy has helped to sweep aside long-standing strains between G20 member states over currency exchange rates, notably previous calls for China to allow the yuan and Japan to allow the yen to appreciate.

Now several nations are hoping that weaker currencies will help to haul their economies out of what International Monetary chief Dominique Strauss-Kahn has called the Great Recession.

This includes both Central and Eastern European states as well as Britain, whose economies have taken a pounding as a result of the global crisis that was unleashed by the meltdown in the US mortgage market.

But the key task for the finance ministers meeting in the wood-panelled rooms of the South Lodge Hotel this weekend will be to try to allay the deepening sense of uncertainty about the global economic outlook by stressing that everything is being done to ward off the downturn.

Dispatching the US Treasury Secretary Timothy Geithner to the finance ministers' meeting, American President Barack Obama called on the G20 to step up moves to halt the global economic slowdown, adding that more government stimulus will be a top US priority at G20 leaders' summit in London next month.

"As aggressive as the actions we are taking have been so far, it's very important to make sure that other countries are moving in the same direction, because the global economy is all tied together," Obama said Wednesday in a meeting with Geithner.

But speaking Thursday at a joint press conference in Berlin with French President Nicolas Sarkozy, German Chancellor Angela Merkel stressed the need for overhauling financial market regulation to help face up to the world economic slowdown.

Merkel said that economic stimulus packages "can under no circumstances replace the necessary regulation" of the financial markets.

"The problem is not spending more money," said Sarkozy, "but putting in place financial systems of regulation."

There appears to be general agreement on the need for global joint economic action with a draft European Union (EU) paper prepared in advance of the G20 meetings saying: "Coordinated and timely action is necessary to put the global economy back on the track towards recovery."

But underscoring the EU drive for tighter financial market regulation, the paper said: "The G20 summit in London has a crucial role to play in reshaping the global financial system and rebuilding the confidence of economic actors across the world."

However, sweeping changes to the financial system could still take some time to finalize.

What is more, despite a measure of calm returning to markets, the buildup to the weekend G20 meeting has been accompanied by a slew of almost catastrophic economic numbers.

This in turn has helped to fuel concerns that the economic and financial crisis could rapidly transform itself into a labour market crisis as companies around the world step up production cuts and layoffs to cope with a slump in business.

As a result, with interest rates in the world's leading economies approaching zero, the pressure is likely to grow on the G20 to come up with more solutions for undercutting the recession.

However, the problem for both the G20 leaders and the finance ministers is that it could also take some time for the stimulus plans to take effect and consequently to assess their impact on limiting the fallout from the crisis.

In the meantime, the focus for many governments has now shifted to micro managing national problems and helping to come up with specific solutions to the difficulties facing industries notably the crisis-hit car sector. (dpa)