A fruitful year. Oleksiy Pavlenko, Minister of Agrarian Policy and Food of Ukraine reflects on the year’s milestones

How has the Ukrainian agricultural sector changed? The stress of the former markets loss has acted as a powerful impulse to the search for new export destinations as well as the creation of new technological productions and niche products.

A year ago, on December 2, our team started fulfilling the task of reforming and preserving the capacity of the agricultural sector. So far excessive government control, imperfect legislation and investments without which the hopes for modernization always look ghostly, have been cohabiting somehow in Ukraine. A favorable investment climate, transparency and predictability of the business environment can prevent the outflow of capital from the industry. To achieve it, we have successfully implemented a range of initiatives to harmonize national legislation with the standards of the European Union.

To avoid controversy, a Single integrated development strategy for the agriculture and rural areas for the years 2015-2020 was adopted. The representatives of the leading international organizations, including World Bank, IFC, USAID, FAO, EIB, OECD, OSCE participated in its development. In the document special attention is paid to food safety as well as to the problems of sanitary and phytosanitary standards.

To stimulate entrepreneurial interest and dispense business from excessive state supervision, the Ministry began a comprehensive reform to deregulate the industry. During the year we have abolished a number of approval documents, veterinary certificates, quality certificates, licenses, more than 50 legislative changes in terms of deregulation have been introduced. The result was not long in coming: just during the first six months of 2015 capital investments in the agriculture, forestry and fishery increased by 9.6% as compared with the same period last year.

The priority task of the Ministry is to ensure food security of the country. Ukrainians have nothing to worry about, because Ukraine does not only meet the needs of the domestic market, but also supplies foreign partners with a lot of products. With proper investing, we are able to feed twice as many people as we are doing now, and this time is not far off.

Among the most attractive areas of AIC are the bioethanol production, the modernization of irrigation systems in the south of Ukraine, the development of river logistics and navigation on the Dnieper and the Southern Bug, the processing industry, the output of products with a high added value, and also the development of small and medium-sized farming companies, the investments in the agricultural machinery lease and development of the seed farming and breeding.

Until recently, the future of the agro-industrial sphere has caused a lot of skepticism due to the crisis and the loss of the traditional Russian market. However, the stress of the former markets loss has acted as a powerful impulse to the search for new export destinations. As a result, our farmers have begun an active cooperation with the countries of Asia, Africa and the EU. It is evidenced by the numbers: during nine months of 2015 in the structure of our exports Asia has 47.2%($4.9billion), the EU – 25.7% ($ 2.6 billion), Africa – 13.7%($1.4billion), CIS countries – 10.6%($ 1.1 billion), the United States – 0.3% ($ 30.8 8 million), other countries – 2.7%($276.4 million ).

However, without the trust of our partners, we could not have achieved these results. No one will work with the manufacturer who has chaos and shady fraud prevailing at their enterprise instead of clear regulations. The fight against corruption has become one of the main activities of the Ministry of Agrarian Policy. We have filed more than 100 complaints to law enforcement agencies and assist as much as possible to identify and investigate abuses at the agro-enterprises. According to Transparency International Ukraine, the agricultural sector shows some of the best figures on the dynamics of corruption decreasing in Ukraine.

The agricultural sector of Ukraine is an economic powerhouse providing 14% of the total GDP. Our country holds leading positions in the rankings of the world exporters of agricultural products: we are №1 in the world supply of sunflower oil, №3 – of corn, №4 – of barley, №6 – of wheat, №7 – of soy and №8 in the production volumes of chicken meat. In 2014/15 MY, we achieved the record grain exports for all the years of independence – 34.8 million tons that allowed Ukraine to get into the top three of world cereals exporters after the US and the EU. Despite conventional stereotypes about the wholly commodity type of our AIC, there is a place for new technological productions and promising niches.

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