The United States dealt a tough blow to a British plan to pull Africa out of poverty, even before the Group of Seven economic powers started a meeting in London last night to discuss Third World debt and the global economy.

The British Chancellor of the Exchequer, Mr Gordon Brown, the host of the meeting, says he has secured the support of European G7 partners for his proposals to reduce African debt, in particular.

But Mr John Taylor, US Treasury Under Secretary, rejected the plan to create an International Finance Facility to raise $100 billion a year for the world's poorest countries.

"Not only does the facility not work for the United States, we don't need it," Mr Taylor said, arriving in London to stand in for the Treasury Secretary, Mr John Snow, who was too unwell to attend.

Nor was he convinced of Mr Brown's other plan to revalue the International Monetary Fund's gold reserves to find cash to write off the debts of the impoverished African countries.

Washington has its own plan to offer grants to poor countries with conditions that may be unpalatable to recipients.

Although British officials managed a brave face, the US rebuff was a setback to their G7 presidency plan to help Africa and meet a United Nations goal of halving world poverty.

The US rejection of the poverty plan may also be seen as a personal blow to the British Prime Minister, Mr Tony Blair, whose unstinting backing for the US over Iraq has not been rewarded with the support on debt he had sought from Washington.

Italy said that it would now table a more modest proposal. This would involve opening the finance facility but only to raise sufficient funds to order vast quantities of vaccines from drug companies as an incentive for them to invest in research to discover the immunizations for diseases such as malaria. - Reuters