Ms. Merkel, who is gearing up for a parliamentary election in September, faces the daunting task of steering the G20 towards a consensus

German Chancellor Angela Merkel pressed fellow Group of 20 leaders to compromise at the start of talks on climate and trade that have pitted U.S. President Donald Trump against virtually every other country in the club of leading economies.

The host of the G20 summit addressed her counterparts on Friday in a hall at the Hamburg convention centre. Ms. Merkel was shown talking casually with Russian President Vladimir Putin as the leaders entered the hall, then joining French President Emmanuel Macron in a three-way discussion with U.S. President Donald Trump, who was seated between Chinese leader Xi Jinping and Britain’s Theresa May.

“We all know the big global challenges and we know that time is pressing,” Ms. Merkel told the group. “And so solutions can only be found if we are ready for compromise and move towards each other, but without — and I stress this — bending too much, because of course we can also state clearly when there are differences.”

Daunting task

Ms. Merkel, who is gearing up for a parliamentary election in September, faces the daunting task of steering the G20 towards a consensus on trade, climate change and migration — all issues that have become more contentious since Mr. Trump entered the White House half a year ago promising an “America First” approach.

Last month, he pulled the U.S. out of a landmark international agreement aimed at combating climate change. And he is threatening to take punitive trade measures in the steel sector which would hit China, Germany, Canada and a host of other countries.

The Chinese state news agency Xinhua reported that President Xi had called on G20 nations to strengthen macroeconomic policy coordination and forestall risks in financial markets.

“Xi also urged G20 members to develop financial inclusion and green finance to make the financial sector truly drive the development of the real economy,” Xinhua added.

Envoys have been working for weeks to bridge differences, and European sources said they had come up with new language on the climate issue on Thursday which would be put to the leaders for approval.

The latest draft communique sticks with language about the Paris climate accord being “irreversible” but removes a reference from an earlier version to a “global approach” that some countries felt could suggest there was a parallel track to Paris.

It also includes a new paragraph which says the United States will “work closely with other partners to help their access to and use of fossil fuels more cleanly and efficiently". Some experts were sceptical whether leaders would approve the reference to fossil fuels, which would be a clear nod to Washington.