G8 summit pledges $20 billion to boost food output

L'AQUILA, Italy (Reuters) - Leaders from rich nations at the G8 summit committed $20 billion over three years to boost agricultural investment in poorer countries and fight hunger, $5 billion more than expected.

A statement after talks on Friday highlighted the new emphasis on farm aid to help poor nations feed themselves, although it said leaders were still committed to providing emergency food assistance.

The text did not make clear whether the $20 billion was all new funds, nor did it give details of individual countries' contributions. The United States -- which championed the initiative -- said it would contribute at least $3.5 billion over three years.

Japan and the European Union are expected to step in with around $3 billion each, while Britain has pledged $1.8 billion.

The statement made no mention of a trust fund for the contributions to be managed by the World Bank, a proposal put forward by Washington in previous drafts but opposed by the EU.

It said the leaders had agreed to a "coordinated, comprehensive strategy focused on sustainable agriculture development, while keeping a strong commitment to adequate emergency food aid assistance."

They also called on all countries to remove food export restrictions and extraordinary taxes, especially for food purchased for humanitarian reasons.

The statement said the combined effect of longstanding underinvestment in agriculture, price volatility and the economic crisis had led to increased poverty and hunger in developing countries.

BIG SHIFT IN POLICY

According to the United Nations, the number of malnourished people has risen over the past two years and is expected to top 1.02 billion this year, reversing a four-decade trend of declines.

The leaders said the farm aid would target increased agricultural productivity, new seeds and technology, private sector growth, women and smallholders, preservation of natural resources, job expansion, training and increased trade flows.

Ajay Vashee, president of the International Federation of Agricultural Producers, welcomed the policy shift.

"Before, there was always this complacency that emergency food aid would get poor countries through food crises, so a lot of reforms that needed to be taking place in developing countries did not happen," he said.

He said 40 percent of crops are lost in Africa due to inadequate storage or lack of proper distribution to market.

Jacques Diouf, head of the United Nations Food and Agriculture Organization, called it "the biggest shift in strategy I have seen over the past two decades."

The United States is the world's largest aid donor of food -- mostly grown domestically and bought from U.S. farmers.

Aid groups said the funds pledged were more clearly focused than in the past, but that more details were needed on where the money would come from.

"It is still unclear who, other than the U.S. and perhaps one or two other countries, is putting real new money into this," said Oliver Buston of anti-poverty group ONE.

(additional reporting by Silvia Aloisi; editing by Ralph Boulton and Elizabeth Piper)