Worst Global Financial Crisis Since The 1930s
They are looking at ways to revive the world economy and at how to strengthen the financial system to prevent a repeat of the crisis in the future.
Rifts exist between key players but signs are that an agreement is close.
More demonstrations are expected after protests in London’s financial district on Wednesday.
The summit is being held, amid tight security, at the Excel Centre in London’s Docklands.
Leaders will hold a working breakfast and then the wrangling will begin in earnest.
In the run-up to the summit, the main differences have been between France and Germany, who are seeking stricter regulation of the financial system, and the UK and US, who think extra government spending would do more to ease the crisis.
France’s president, Nicolas Sarkozy, has threatened to walk out of the meeting if the G20 did not come up with concrete results.
However, BBC economics editor Stephanie Flanders says that the G20 is close to an agreement.
The main disputes are financial rather than ideological, our correspondent says.
Police said that 5,000 demonstrators attended Wednesday’s protests, which carried on late into the night.
One man collapsed and died at the protest, police said.
They were largely peaceful although demonstrators stormed a branch of RBS and scuffled with police.
Police said that 32 people were arrested and one officer was admitted to hospital.
Six police forces are part of the £7.5m G20 security plan, led by London’s Met.
The demonstrators include anti-capitalist protesters, environmental campaigners and anarchists, who say they want changes to how the global economy is run.
The recession has worsened since G20 leaders met last November in Washington.
Both the IMF and the World Bank expect the world economy to shrink for the first time in decades this year.
The summit is expected to push for closer supervision of hedge funds, private equity firms and derivatives trading.
Tax havens are also likely to be targeted.
There are also calls for countries to step up spending on stimulus packages to boost recovery but specific commitments look unlikely given opposition from France and Germany.
The G20 groups the world’s most powerful economies, accounting for 90% of the world’s economic output. 80% of world trade and two thirds of the world’s population.
