The food crisis of 2008 had a massive impact in the developing world. Countries like India blocked all exports in order to secure supply at home, and panic-hoarding was even seen in California after Americans were spooked by the global explosion in cereal prices.

In 12 months, wheat prices surged by 130 percent, corn by 140 percent. Experts identified a variety of causes - rising demand in China and India, a weak US dollar, weather disasters in vital bread basket countries, and an increase in demand for bio-fuels.

In reaction to this crisis, the G8 summit in L'Aquila in Italy promised developing nations $20 billion (14.9 billion euros) to support the agriculture and small farmers.

German Chancellor Angela Merkel pointed to the consequences of the food crisis and warned that many people in poor countries were not able to afford soaring prices for staple foods.

"It means we have a 100 million more people in poverty. That makes our responsibility even greater not to slacken in securing food supplies and investing in infrastructure, but to remain constant," Merkel said.

Overdue

Marwin Maier of the Christian charity organization World Vision said this $20-billion promise was long overdue. "It's good that we finally have a very clear change in the position to the food crisis," he told Deutsche Welle. "It's very positive that we are moving away from the short-term strategy of delivering sacks of rice towards ensuring the food supply. But the overall result is that the poor got nothing from this summit."

Rafael Schneider of the German charity Welthungerhilfe agrees that the summit at least sent out the right signals. "It's good that we've found this return to agriculture and supporting rural areas. That was a very important political signal in the G8."

But there are a few question marks still hanging over the L'Aquila summit. One big problem is the massive surpluses produced in industrialized countries that are shipped to developing nations at state-funded prices.

According to Schneider, agricultural and export subsidies are a problem. "They are holding back the development of agriculture in developing nations," he said.

Delayed handouts

Some believe that the western world is systemically destroying agriculture in the third world, then handing out alms - which are very slow to come. "The funds are not flowing as you might expect," said Schneider. "Hardly anything has arrived of that $20 billion. And you have to keep asking, is this really being spent on agriculture and land development and securing supply?"

The charities also complained that the money was simply money that had already been promised, just renamed and repackaged.

The right path is not offering handouts but sustainable investment

"A lot of projects that simply take place in the countryside are counted as contributions to agricultural development," said Schneider. "That includes fighting drug trafficking, clearing mines, planning cooperatives. These are all useful things in rural areas, but they don't lead directly to improving the food supply. The problem is, firstly, what is really being invested in? And secondly, is this $20 billion really being invested?"

But Schneider draws some comfort from the fact that development policy in the western world has now at least come to the conclusion that helping small farmers is the best way to ensuring a long-term food supply.

"The small farmers are not only the key to overcoming poverty, but also to overcoming many environmental problems," he said. "We have seen that mass industrial agriculture over-exploits natural resources - resources like water, soil and energy. And it pollutes the air. In the face of climate change, you can get very good results if you support small-scale agriculture."

Author: Rolf Wenkel / bk

Editor: Sarah Steffen