A former university economics professor, who has moved easily between the academic and political worlds for the best part of 40 years, he is best known for serving as Valery Giscard d'Estaing's prime minister from 1976-81.But he has weathered the decades better than Giscard, and so have his politics. Washing and brushing have been the very least of what has been done in preparation. A week ago, there was still sheeting and cables all over the floors; you shared the lifts with trestles and paintpots, and the smell of varnish was everywhere.Thursday night's opening G7 dinner, with a secret menu that will boast the quintessence of Lyons' renowned cuisine, is to be held - weather permitting - in the loggia courtyard. This week, all being well, he will experience one of his finest hours, as host to the heads of the world's seven richest nations in the annual summit of the Group of Seven industrialised countries. Not an overtly proud or arrogant man, Mr Barre will bask unashamedly in the glory of the occasion and plans to show off his magnificent 19th century town hall to the full. Lyons - The Germans have an expression, "like God in France", to describe a state of luxurious contentment. Raymond Barre, the 72-year- old politician and academic who is experiencing a second political honeymoon as mayor of France's second city, Lyons, seems a personification of the expression just now. But President Mubarak expressed his delight at what he considered a Jordanian-Syrian rapprochement and an invitation to the PLO's Yasser Arafat by Mr Assad to visit Damascus, a meeting of advantage to both sides.Saddam Hussein got short shrift.

The Saudis included their wish for the future unity of Iraq - they do not want a new Shia state on their northern frontier - and the Kuwaitis won a demand for full Iraqi compliance with the UN and the return of all Kuwaiti prisoners from Iraq.But it was Libya's Colonel Muammar Gaddafi who made the most pertinent if ironic remark about Mr Netanyahu at the summit's end "We should thank him for bringing us together," he said "Without him, there could have been no such summit.". Syria, which wanted a condemnation of Turkey, not only for its military agreement with Israel but for its tampering with the waters of the Euphrates, had to be satisfied with "concern" about the Turkish-Israeli pact and a hopeless request to Turkey to "reconsider" its new agreement "so as not to affect the security of Arab states".Having largely got what he wanted in the communique, President Assad chose not to say a word at the summit. for efforts to hold an international conference on terrorism".Attempts by King Hussein to rouse the Gulf Arabs against Iran - and thus indirectly against Iran's Syrian ally - were softened to say that "Iran should respect the sovereignty of Bahrain and stop any destructive acts aimed at Bahrain" and should end its occupation of three Emirates islands. But the King's words also appeared to condone Israel's April assault on Hizbollah guerrillas which led to the massacre at Qana.The Syrians were incensed, and their Foreign Minister, Farouk al-Sharah, bitterly condemned the King's speech in a private talk later with his Jordanian opposite number.But when the King and President Hafez al-Assad of Syria later met alone Mr Assad apparently persuaded King Hussein that it was more important to present a united front to Israel's new government than give Israel ammunition to attack an Arab neighbour. This led to the communique's statement that "while the Arab leaders condemn attempts to label legitimate national resisters terrorists, they condemn all kinds of terrorist and destructive acts .. and express support ... Jordan says Syria tried to send saboteurs across the Jordanian-Syrian border and sympathises with Turkey's complaints of Syrian support for Kurdish guerrillas.

Then came the paragraphs which proved how disunited the Arabs still are.King Hussein of Jordan had given an address of such fury that other delegates dubbed it "Netanyahu's speech"; he attacked "terrorism" in all its forms, adding - in a clear attack on Syria - that "we must confront the problem of cross-border terrorism, through condemnation, pursuit, and through the liquidation of pockets of terrorism, wherever their dens may be .. and whoever may be their organisers or victims". None of them objected to the prelude, which called upon the rest of the world to ensure Israel kept to its side of the bargain; there was much talk of commitments, agreements, vows and "international legality" - the latter to prevent the construction of yet more Jewish settlements on Arab land. What mattered yesterday was the text of their final communique and the long, sometimes furious arguments which produced it. We still want peace, the Arabs were saying yesterday, but do not blame us when the pot boils over.They will be blamed, but that is another story. The Arabs "would have to reconsider their steps towards Israel in the framework of the peace process" if there was any Israeli abandonment of commitments."What do you expect Arabs to do? What do you expect Palestinians to do?" an exasperated President Hosni Mubarak of Egypt said after the summit ended. "Much more violence? Much more terrorism?"The truth, as many Arab journalists were quick to point out, is that the Arab nations (all, apparently, bar Jordan) believe that the five years of negotiations with Israel and the Oslo agreement are dissolving in the heat generated by Mr Netanyahu's three "Nos" - no to a withdrawal from Golan, no to a Palestinian state and no to a Palestinian capital in east Jerusalem. "This is the most elementary, fundamental requirement for talks about coexistence and peace." He went on to say that the peace process "cannot be made hostage to other prior conditions" - a reference to the Arab demands that the new government agree to trade more land for peace.What the Cairo communique actually said was that the Arabs remained committed to the process of peace on which they had embarked at Madrid in 1991: total Israeli withdrawal for total peace based on UN Security Council resolutions 242, 338 and 425, along with an end to Jewish settlements on Arab land and a "just and comprehensive peace" that would give Palestinians a state and a capital in Jerusalem.

And there were the Israelis, whose new Prime Minister, Binyamin Netanyahu, has already vetoed the agreed land-for-peace formula, claiming that the Arab summit's final communique represented a threat to peace. "For the process to continue successfully and productively this threat [to Israeli security] must be removed," Mr Netanyahu said in a prepared speech. I have nothing to hide."He said that his campaign records would be made available to the Attorney- General for "an urgent and exhaustive investigation.". No words, it seems, can sum up the hypocrisy that now surrounds the ashes of the Middle East "peace process". There were the Arabs at their Cairo summit yesterday, solemnly pleading for a continuation of the American-brokered land-for-peace "process" and warning that they might have second thoughts if Israel did not honour its commitments.

He is in jail awaiting trial."This is the first time, perhaps in my life, that I have to swallow my words," Mr Perez Balladares said "I am a proud person It hurts that there was this type of money in my campaign. He said he could not remember endorsing them and had no idea at the time that Mr Castrillon was involved in trafficking drugs.Mr Castrillon operated a tuna-fishing fleet in Panama until he was arrested on 16 April Prosecutors say the fleet was a cover for the Cali cartel's sea-going cocaine exports to the US, worth billions of dollars. Government sources said Mr Perez Balladares had ordered the audit of his campaign funding because he was planning to sue the British magazine. Instead, he will drop the suit, the sources said.Mr Perez Balladares said the audit had turned up two cheques, endorsed by him, from a company believed to have been owned by Mr Castrillon. On the last day of that year, Panama is due to take control of the Panama Canal from the US, which it has controlled since the start of the century.Mr Perez Balladares was along-time friend and aide of Manuel Antonio Noriega, the army general who ruled Panama until the US, under President George Bush, ousted him by invading in 1989. Many Panamanians who despised General Noriega were surprised at Mr Perez Balladares's election victory two years ago at the head of the Democratic Revolutionary Party, which Gen Noriega always supported.The President's admission was apparently the direct result of a recent report in The Economist which hinted that his government was tainted by Colombian drug money. Castrillon was recently jailed in Panama on charges that he headed the Cali cartel's sea-going cocaine exports to the US. Ernesto Samper, president of Colombia, was cleared last week by parliament, which his party controls, of knowingly accepting Cali cartel cash for his 1994 campaign.