Angela Merkel called upon all countries to join a binding post-Kyoto settlement on cutting greenhouse gases as she burnished her green credentials when she opened the World Economic Forum in Davos today.

The German Chancellor also used her keynote address to challenge developing nations to step up and share increased global responsibilities, outlining a plan to invite countries such as India, Brazil, Mexico, China and South Africa to join the G8 table as equal players.

This should be "a new form of dialogue", which will be developed at the German G8 summit this summer. "We should ask those with the highest growth rates to share global responsibility and to make it their own," she said.

Mrs Merkel also urged a solution to be found in the Doha Round of world trade talks, which stand a real chance of resuming on Saturday when trade ministers meet in Davos informally to discuss the way ahead.

She said that the two greatest challenges facing the world were climate change and energy security and emphasised that the days when either Europe or the United States or both could tackle these issues - or the creaking world trade system - were over.

"The world economy is going through a process of tremendous change as a lot of things are turned upside-down that for a long time we had taken as a given," she told the audience of business and political leaders gathered at the Swiss ski resort.

"We have a completely new balance of power in the world today. China will pass the two export champions - Germany and the US - in just two years.

"But those who consider themselves to be the champions of tomorrow cannot be certain they will also be the champions of the day after tomorrow."

Her message to the global leaders was to find news ways of working together to harness the forces of globislisation for all nations - or to risk ostracising those already fearful of the pace of change.

Germany finds itself in a powerful position in the global community thanks to its twin presidency of the European Union and chairmanship of the G8.

But while Mrs Merkel emphasized at the European Parliament last week that the EU must make internal changes to ensure a fair energy market and tough targets on climate change, she yesterday accepted the declining influence and importance of her own continent in a global context.

Nowhere was this more evident or important for her G8 agenda than in tackling climate change. Mrs Merkel welcomed the renewed commitment of President Bush in his State of the Union speech to seek the new technologies that will cut emissions. But she said that only a mandatory target for every polluting country could succeed.

"We need a binding regime that includes all of those who produce emissions. Of the overall CO2 emissions we [the EU] has 15 per cent. 85 per cent of those emissions come from somewhere else and the share of Europe is going to go down, so it is a global responsibility."

Part of the sense of global responsibility she wanted to encourage would be through a meeting in September to boost funding to fight the scourge of HIV/Aids, which disproportionately affected Africa. But she warned developed nations from preaching to Africa and other developing countries. "If we see shaping globalisation as an act of philanthropy by the know-alls then it won't work."

Mrs Merkel repeated her call for a new era of trade relationships between the EU and US, cutting unnecessary transatlantic costs and bureaucracy.

She said during a question and answer session later that her own life experience showed that apparently cataclysmic changes could be benign. After all, she was brought up in East Germany, a country which 'lost' the Cold War.

"Freedom is an aspect of globalisation. In my personal case, of the Cold War - I ended up on the winning side. When I was 35 years old my life changed most profoundly for the better, so change, as far as I am concerned, is not always difficult. For me, change has really widened my scope."

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