"Agribusiness and Infrastructure" focus session: breadbasket of Europe needs investments
The "Agribusiness and Infrastructure" focus session was held in terms of the first Ukrainian-American Business Forum July 13 in Washington
Ukrainian speakers on this issue were Minister of Agrarian Policy and Food of Oleksiy Pavlenko and Infrastructure Minister Andriy Pyvovarsky. It was stated that Ukraine has strengthened the protection of investor’s rights, simplified agricultural land lease agreements, eliminated number of required licenses and permits, opened new vacancies at state enterprises, and introduced electronic auctions system. In the nearest future Ukraine is preparing for 86 state enterprises privatization, 118 permits and licenses eliminations, implementation of crop receipt and agro insurance systems. The country is to harmonize Ukrainian agriculture legislation with the EU standards and liberalize the land market.
Minister of agriculture underlined that Ukraine needs investment in infrastructure, value-added production to reach its agricultural potential. Ukraine is encouraging free trade to unlock its agriculture capability by implementing sweeping reforms, deregulation, easing rules for investors are required for agrarian sector of Ukraine.
Three principles of the new Agricultural Policy were announced during the Forum: encourage value-added production, promote free competition, get the State out of the way so businesses can excel. “We want to reach 100 mln tons of annual grain production to double exports, triple the production of goods with added value,” added Mr. Pavlenko.
“Ukraine in the infrastructure behind the times, - he admitted, - almost all the granaries were built in Soviet times and this facilities are 70% outdated”. An irrigation system, which exists to support the south (due to the climatic peculiarities; there is less rain on the south of Ukraine) but still it needs renovation and investment.
“Russia’s aggression has brought a red mist down along our eastern border Golden meadows of sunflower have become battlefields,” said the Minister.
Ukraine has long produced more food than it needs and so Ukrainian crops feed people across the globe. Ukraine is a “farmer’s paradise – largest arable land bank in Europe (over 41 million hectares of farmland), one-third of the world’s black soil,” highlighted the speaker.
Ukraine’s agricultural sector operates at only 50% of capacity due to poor inputs, outdated techniques and idle lands (4 million hectares). It opens new perspectives and opportunities for investment in the hope of bilateral benefits for the future.
And lo and behold, if you follow the chronology of investments into Ukrainian agricultural sector, you see that several US companies are already successfully operating in Ukraine; among them are Agco, John Deere, Bunge, Cargill, Dupont Pioneer. By the end of 2015 the global leader Bunge plans to oilseeds processing technologies in Mykolayiv, Ukraine. Food and Agriculture Organization of the United Nations has allocated from its own budget and special fund $ 800 thousand for emergency aid for small farmers Donetsk and Luhansk region.
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