Chinese yuan likely to feature in G20 talks

MELBOURNE, Nov 17 (Reuters) Finance ministers and central bankers from the Group of 20 countries today gathered in Melbourne for weekend talks set to feature the Chinese yuan, energy and minerals security and global economic conditions.

Australian Treasurer Peter Costello said the inflation outlook and its implications for monetary policy around the world would be a major topic for the G20, which draws together industrialised and developing countries.

''The global economy will be a key issue. Global inflation prospects will be discussed, the monetary policy response -- not just in Australia but around the world -- where central bankers around the world see monetary policy going,'' Costello told reporters.

The meeting will bring together officials from a diverse group of countries, including the United States, China, Saudi Arabia, South Africa and Indonesia.

Costello said it was natural that issues relating to the Chinese yuan would be brought up at such a meeting of finance ministers and central bankers.

''But it has to be done delicately. Countries don't generally respond to lectures from other countries,'' Costello said.

''But in my experience these issues quite frequently come up and I'd be surprised if someone didn't raise it.'' Ministers met for bilateral discussions ahead of the formal meeting, including talks between Costello and his counterparts from Japan, India, Germany and South Africa.

While Britain is pressing for global warming issues to be discussed at the meeting, Costello said emission questions would come up in the context of energy pricing ''We won't be negotiating a Kyoto-type agreement here,'' Costello said.

Two helicopters hovered over downtown Melbourne and streets were blocked off around the site of the meeting ahead of expected demonstrations.

REUTERS SHB BST1014