Somalia might still be described as the world's worst failed state, but international enthusiasm for involvement there is ticking up to levels not seen since the 1994 withdrawal of international peacekeepers.

Following the October 1993 Blackhawk Down debacle in which 18 US servicemen and well over a thousand Somalis died in a botched Mogadishu battle, world powers have largely left Somalia to anarchy, chaos and conflict. Some estimates suggest more than a million people may have died since Somalia's last government collapsed in 1991.

But Thursday's London conference on Somalia -- which brought together representatives of more than 40 countries including U.S. Secretary of State Hillary Clinton and UN Secretary General Ban Ki-moon -- appeared to be the latest sign that approach might be beginning to shift.

Officials say growing worries over Somalia becoming perhaps the leading global haven for Islamist militancy and the rising cost of Somali piracy -- estimated to cost the global economy some $7 billion a year -- helped spur action.

For two decades politicians in the West have too often dismissed the problems in Somalia as simply too difficult and too remote to deal with, British Prime Minister David Cameron told the summit. Engagement has been sporadic and half-hearted. That fatalism has failed Somalia. And it has failed the international community too.

But with the capital Mogadishu largely under transitional government and peacekeeper control, Islamist group Al Shabaab on the back foot and apparent if largely unexpected progress against piracy and a regional hunger crisis, a cautious optimism is also driving involvement.

The examples of semi-independent and relatively stable enclaves such as Somaliland and other non-Al Shabaab held areas -- and now perhaps Mogadishu itself -- are boosting international hopes the country might not be as ungovernable as previously feared.

We are moving Somalia from the too difficult box into the difficult box, said one Western official.

While many officials, analysts and Somalis themselves remain sceptical, leaders such as Britain's Cameron and Turkey's Tayyip Erdogan appear increasingly to see the country as an arena on which they can show global and personal leadership.

CHANGING THE LANDSCAPE?

In August, Erdogan became the first non-African leader in years to visit the country, part of a wider strategy positioning Turkey as a growing regional and global power. Turkish firms have also begun major reconstruction projects in the country including an airport, spurring Somali hope other investors from other countries will now follow.

Whilst United Nations and Western diplomats -- and indeed Somalia's government itself -- have largely based themselves in neighbouring Kenya, Turkey has opened relief camps within Somalia and an embassy in Mogadishu.

Others now look set to follow.

The UN is already relocating its political office to Mogadishu, while Britain said it was also looking to reopen its long-closed embassy. U.S. Secretary of State Clinton was more noncommittal, but she too talked of moving to a more permanent U.S. diplomatic presence in the country.

Attendees at the summit made it clear Somalia's current internationally-backed transitional government was expected to stand down when its mandate expires in August. In its place, foreign officials hope, will be a new government that should be more representative and accountable, drawing up a new constitution.

The August deadline probably isn't realistic, said Adjoa Anyimadu, a researcher and Somali specialist at London-based think tank Chatham House. But the idea of a government chosen by Somalis rather than the international community is a good one. We're almost certainly not talking true democratic elections at this stage but any more accountable process is better... And there's no doubt the international community is more confident than it was on Somalia

British officials say that while the London conference did not yield any one particular breakthrough or agreement, it did help speed activity on a range of fronts necessary to build on recent successes.

Indian Ocean nations agreed several steps to tackle piracy, moving to track the payment of ransoms and pin down pirate kingpins as well as setting up new agreements by which countries in the region would try and imprison pirates captured at sea.

Successful hijackings of merchant ships fell sharply in the second half of 2011 largely due to greater use of private armed guards and a more aggressive approach by naval forces, international maritime officials say.

There were also multiple new pledges of humanitarian aid for the Horn of Africa. Aid agencies say malnutrition and hunger remained widespread there, but that a robust and rapid response to last year's drought staved off more serious starvation.

HEIGHTENED MILITARY INTERVENTION

But 18 years after U.S. and UN peacekeepers mounted their humiliating retreat, there is also growing apparent appetite for heightened military intervention.

A British-sponsored UN Security Council resolution agreed the expansion of the African Union AMISOM mission from 12,000 to a surprisingly precise 17,731. That figure would include new Sierra Leonean and Ugandan troops, a senior U.S. State Department official said, as well as placing thousands of Kenyan troops already in the country under AU command.

Troops from Ethiopia -- which fought a controversial US-backed campaign against Somali Islamists between 2006 and 2009 -- also re-entered the country late last year and this week captured the key southern town of Baidoa alongside Somali forces. Ethiopian troops will not come under the AU mission and say they will withdraw once stability is restored.

Somalia's transitional government would clearly like more support. In interviews and during the conference itself, Somali Prime Minister Abdiwell Mohammed Ali said repeatedly that he would welcome foreign air strikes against Al Qaeda and Al Shabaab targets providing there were no collateral civilian casualties. Al Shabaab recently announced it was allying itself to Al Qaeda.

Secretary of State Clinton bluntly rejected the call, saying that whilst she was no military strategist she knew enough to know that such strikes would be a bad idea. Instead, she pledged a tougher line on enforcement of sanctions -- particularly blocking charcoal exports to Middle Eastern countries believed a major source of Al Shabaab funding.

But early on Friday, Somali officials said there did appear to have been an airstrike in southern Somalia -- perhaps one of the largest so far -- killing at least three foreign Al Shabaab fighters. Analysts say that while it is not entirely clear who launched that or previous similar strikes, U.S. unmanned drones appear the most likely suspects.

In many ways, I think I was more confident before the summit, said Anyimadu at Chatham House. All this emphasis on security and talk of airstrikes -- there's a real risk we will simply repeat the mistakes of the past.

(Reporting By Peter Apps)