The seven men and one woman representing the world’s wealthiest economies have such divergent positions on both issues, however, that no major agreements are expected by the time the annual summit ends the night of June 8.
Overshadowing the entire event is Russian displeasure with the United States for pushing ahead with plans to locate an antimissile defense system in Poland and the Czech Republic.
Goals On Africa, Climate Change
Despite the tension, at a joint press conference earlier today with Bush, Merkel struck an optimistic chord about her hopes for the talks.
"I think the signal that should come out of this G8 summit is that we should give globalization a human face by fighting poverty, guaranteeing the freedom of investments and keeping in sight the social dimension of globalization, promoting world trade, and we should also think about how we can contain international conflicts together," she said.
Bush also stressed his desire to make progress, and said he came to the summit committed to helping solve some of the most serious problems facing Africa.
"I come with a deep desire to make sure that those suffering from HIV-AIDS on the continent of Africa know that they'll get help from the G8," the U.S. president said. "I come with a deep desire to work with the people around the table to reduce malaria on the continent of Africa and feed the hungry. I know you [Merkel] share that desire, as well, and thank you for your leadership."
Although Bush arrived in Europe on June 4, today was the first time he was able to focus on the summit.
His first stop, in Prague -- to discuss the planned U.S. deployment of an antimissile system -- was dominated by the chill in U.S. relations with Russia.
Speaking on June 5, Bush took a carrot-and-stick approach. He said that during his meeting with Putin on June 7 at the summit, he would invite the Russian leader to allay his fears by investigating the radar installation sites himself:
"I look forward to having conversations with President Putin, not only at the G8, but up in the United States when he comes over," Bush said. "And my message will be, you know: 'Vladimir' -- I call him Vladimir -- 'You shouldn't fear a missile-defense system. As a matter of fact, why don't you cooperate with us on a missile-defense system?'"
But a few hours later, at another venue, he had harsh words for Russia's lack of progress on democratic reforms.
"In Russia, reforms that were once promised to empower citizens have been derailed, with troubling implications for democratic development," Bush said. "Part of a good relationship is the ability to talk openly about our disagreements. So, the United States will continue to build our relationships with these countries, and we will do it without abandoning our principles or our values."
Moscow Stands Firm
Putin, too, has sharpened his rhetoric in recent days.
He told journalists from G8 countries that the United States was single-handedly responsible for changing "the entire configuration of international security" by pursuing a missile-defense system in Europe.
Moscow says the system is directed against Russia. Washington argues the shield is meant as protection against "rogue states."
G8 host Merkel has urged calm on all sides, saying she expected "constructive discussions from everybody rather than an obstructive attitude."
RFE/RL's correspondent in Heiligendamm reports that Putin was scheduled to meet with Merkel this evening, shortly before the formal dinner.
Thousands of demonstrators have been making their opposition to the summit clear as they gather around the grounds of the seaside resort where meetings are being held.
Several hundred protesters managed to cross security lines and gather outside the 12-kilometer fence surrounding the summit site. Police responded by using water cannons to disperse the demonstrators, some of whom were reportedly throwing stones at security checkpoints.
Thousands of other protesters have attempted to block roads running from the nearby city of Rostock to the summit site.
AN RFE/RL VIDEO PRESENTATION: The Czech Republic responds to the U.S. missile-defense proposal.