Former Australian of the Year Tim Flannery says if the G20 meeting of world leaders in London does not make a decision on further measures to combat climate change, there will be an even bigger economic crisis.

Mr Flannery is one of the key signatories to an open letter from the Copenhagen Climate Council to the G20, calling on the nations involved to invest in green growth or risk handing huge risks to future generations.

President Obama is facing challenges to American power on multiple fronts as he prepares for his first trip overseas since taking office, with the nation’s economic woes emboldening allies and adversaries alike.

Prime Minister Kevin Rudd is standing by his Defence Minister, but says he is disappointed Joel Fitzgibbon failed to declare gifts he received from a Chinese-born businesswoman.

Mr Fitzgibbon last night admitted he failed to declare that Helen Liu paid for him to visit China in 2002 and 2005, and gave him a suit last year, which he later returned.

He previously said that he had only ever received small Christmas and birthday gifts from Ms Liu, who Mr Fitzgibbon says is a close family friend.

Treasury Secretary Tim Geithner, who finished testimony before the Senate Budget committee moments ago, reaffirmed that the cost of cleaning up all the toxic assets clogging the balance sheets of sick financial institutions will be at least $1 trillion.

Federal Health Minister Nicola Roxon has lashed out at the spirits industry's offer not to take back $300 million in tax collected from the Government's alcopops tax increase, accusing them of "paying a bribe".