Leaders from the Group of Eight major industrial nations will warn against complacency over economic recovery on Wednesday at a world summit that will also tackle trade, climate change and food security.

Chinese President Hu Jintao pulled out of the meeting at the last minute because of unrest in northwestern China in which 156 people have been killed. His departure may complicate efforts to make progress toward a deal that would limit global warming. [n

More than 30 world leaders will take part in some of the discussions spread over three days, in recognition of the shifting balance of global economic power.

Italian Prime Minister Silvio Berlusconi, beset by sex scandals, is the summit host and will kick off proceedings at a lunch that will discuss the economic outlook and regulations.

The summit takes place in the Italian city of L'Aquila which was wrecked by an earthquake earlier this year -- a fitting backdrop for discussions on the crumpled global economy that is struggling to overcome the worst recession in living memory.

Policymakers will agree the world economy is still too weak to remove stimulus measures and will consider whether more work is needed to shore up banks, European officials said.

Speaking on the eve of the summit, British Prime Minister Gordon Brown told Reuters the world had to wake up to the scale of the downturn and stay focused on restarting growth.

I am not complacent and remain vigilant about the financial state of the world, said Brown.

The United States, Japan and France are likely to echo his caution, leaving Europe's largest economy, Germany, isolated if, as expected, it seeks a commitment from the G8 to pull swiftly out of costly economic support policies when recovery comes.

G8 leaders badly underestimated the economic problems facing them when they met in Japan last year and Wednesday's talks will touch on what nations must do to prevent another such meltdown.

However, officials said few major initiatives were expected to emerge, with the broader G20 forum, grouping rich industrial nations and major emerging economies, tasked with formulating a regulatory response to the crisis rather than the G8 nations.

The G20 met in London in April and convenes again in September in the United States.

In reality (L'Aquila) is just an intermediary step, said a senior French official.

CHINESE PRESIDENT LEAVES EARLY

Hu had been expected to take advantage of the L'Aquila summit to tell other nations they should start considering a new global reserve currency as an alternative to the dollar.

A Chinese delegation was still set to attend the talks and Berlusconi said he had encountered strong resistance from Beijing over G8 efforts to narrow differences over cuts in greenhouse gas emissions and funding for low carbon technology.

The aim is to agree a goal of limiting global warming to no more than 2 degrees Celsius (3.6 degrees Fahrenheit) since pre-industrial times and strengthen last year's vague vision of halving global carbon emissions by 2050.

A packed first day is due to wrap up with talks on an array of international issues, including Iran's post-election violence and nuclear programme. However, these are unlikely to lead to any immediate action, such as a tightening of sanctions.

One area where officials said a breakthrough might be possible was trade. A draft communique suggested the G8 and G5 developing nations would agree to conclude the stalled Doha round of trade talks in 2010.

Launched in 2001 to help poor nations prosper through trade, the talks have stumbled on proposed tariff and subsidy cuts.

FOOD SECURITY

Leaders will also discuss a U.S. proposal that rich nations commit $15 billion over several years for agricultural development in poor countries to ensure food supplies. [nNo7336759]

Washington is ready to mobilize $3-4 billion and wants other partners to match that commitment, according to a draft declaration. The United States has advocated a shift in the fight against global hunger from giving emergency aid to helping countries produce more of their own food.

World Bank President Robert Zoellick told Reuters a proposed agricultural investment fund, possibly managed by the World Bank, would be discussed and refined at the G8, but a decision may have to wait until a Group of 20 meeting in September.#

The idea of boosting food security for all of the developing world, especially Africa, is a very good one, Zoellick said.

(Editing by Ralph Boulton)

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