The summit host, German Chancellor Angela Merkel, said she was "very, very satisfied" with the agreement but acknowledged that the accord was a compromise that fell short of her hopes for a binding deal.

"Many countries moved on this issue," Merkel said, adding that the accord gave impetus to negotiations beginning in Bali in December to find a successor to the UN-backed Kyoto Protocol on capping greenhouse gases that expires in 2012.

"The very best we could achieve has been achieved," Merkel said.

The chancellor, who holds the G8 presidency, had piled the pressure on President George W. Bush to bring the United States, as the world's biggest emitter of greenhouse gases, on board a process to keep the planet from overheating.

As member states wrangled over the final text Thursday, Bush took a conciliatory stance, saying the United States was ready to take the leading role in a global bid to fight climate change but that China and India must join in.

"The US will be actively involved, if not taking the lead, in a post-Kyoto framework, a post-Kyoto deal," Bush said after talks with British Prime Minister Tony Blair on the sidelines of the summit.

Blair had said he was holding out hope for a pact on significant emission cuts at the summit that would pave the road to a strong deal at a UN meeting Bali, Indonesia in December as the successor to Kyoto.

"I think there is a very substantial coming together around the need to make sure that we have a substantial reduction in emissions and find the right process and right way to achieve that," he said.

Merkel's aim had been for the world's most industrialised nations to take the lead in setting key benchmarks in the run-up to the UN meeting in Bali.

China, India and other developing countries, which have been invited to participate in the summit, are not required to make targeted emissions cuts under Kyoto -- a weakness Washington has frequently criticised.

The United States, the only G8 country that has not ratified the Kyoto Protocol, has flatly rejected any mandatory targets in a new pact.

Bush surprised many last week by offering a counter-proposal in which the United States and up to 14 other big emitters would agree by the end of next year "a long-term global goal" for reducing greenhouse gases.

Merkel has insisted that any agreement come within a UN-framework, a condition Bush warmed to at the summit.

Bush sharply rejected accusations that Washington was doing nothing to tackle climate change, telling reporters that US greenhouse gas emissions had declined in the last year despite the fact that the economy had grown.

"We are taking steps necessary to be good stewards of the environment and at the same time advance technologies," he said.

The meeting of the Group of Eight -- Britain, German, France, Italy, the United States, Russia, Canada and Japan -- taking place in the German resort of Heiligendamm ends Friday.