EU to set up 1bn fund to fight food shortages

The European Union is poised to give €1bn ($1.57bn, £792m) in unused agricultural subsidies to farmers in the developing world to fight food shortages, its farm and development chiefs confirmed on Thursday.

Mariann Fischer Boel, farm commissioner, Thursday said the Commission should agree the plan next week and was confident it would overcome opposition from the majority of farm ministers of member states.

The draft proposal, seen by the Financial Times, would set up a fund of €750m this year and €250m next year taken from money allocated to buy up unsold EU crops which are not needed because of surging food demand.

While the money would normally be returned to national governments, Ms Fischer Boel and Louis Michel, the development commissioner, say it is vital for the EU to play its part in helping those in danger of starvation because of food price rises.