The Cabinet of Ministers of Ukraine approved and launched the introduction of a number of decisions designed to make the year of 2018 a year of a qualitative leap forward in the agrarian sector. This was stated by Prime Minister of Ukraine Volodymyr Groysman during a meeting with a team of one of the processing enterprises located in Ternopil region. The Head of Government is on a working visit to the region today, January 26.

"This year we will have tools to provide a qualitative breakthrough in the agro-sphere. Moreover, the decisions have already been adopted", noted the Prime Minister.

He explained that it is about direct support programs for farmers, compensation for the cost of construction of new dairy farms and cheapening of loans for such construction activities, compensation for the cost of agricultural equipment produced in Ukraine, as well as installments to refund the VAT payments when importing unique equipment and technological lines.

"We are planning that this year, thereby allowing the country to increase the livestock population, production volumes. Agrarians are interested in these programs", said Volodymyr Groysman. "The objective is to improve the performance of economy and create new enterprises. This applies to all areas. For example, today we are paying a lot of attention to the construction of roads. But we emphasize that the essential task is to build Ukraine, but not just to build roads".

Background

In mid-January 2018, the Cabinet of Ministers of Ukraine has finally agreed mechanisms of support for agricultural producers, primarily in livestock sector, and expects that the use of all elaborated decisions will allow this year to significantly increase the number of milk production complexes, farms, to raise livestock population, to increase milk production volumes and other agricultural products. According to the Head of Government, first of all, issues at stake are the incentives for the average agribusiness - both in the segment of crop growing and in the livestock sector. On the proposal of the Government, the total resource allocated for livestock breeding support will be worth UAH 4 billion this year. Funding will be directed, in particular, to support the construction of new farms and complexes - either to provide cheaper loans for building activities or to compensate for part of the own costs of producers spent on construction. Maximum credit resource - EUR 10 million for one production complex at a rate 3 per cent per annum for 5 years. The maximum compensation amount is 25% of the total expenditure. In case of need, according to the results of the first half-year of the effect of the programs, the mechanisms can be adjusted.

Furthermore, the Government approved the program for the development of horticulture. The budget allocation for the said sector will make up nearly UAH 300 million, the  aim of investing is to increase the area of gardens by more than 3000 hectares, to attract new technologies of storage and processing of fruits, and also to create nearly 30 thousand new jobs.

Another equally important issue in focus are the program of compensation for the cost of agricultural machinery, to this end a sum worth UAH 1 billion is planned in the state budget and the introduction of a farm development program with the budget of UAH 1 billion. At the Government’s initiative, funds will be directed to ensure a drastic reduction of interest rate up to 1% for the purchase of equipment, seed selection, and the provision of advisory services. The only state requirement is the complete and fair registration of livestock and land by farmers.

The agrarian sector of Ukraine is determined as one of the engines of national economy, and therefore, the issue pertaining to effective state support for agricultural production is one of the topmost priorities of the budget process. Moreover, the focus is on supporting small and medium-sized businesses, which can fill the domestic market and strengthen the export opportunities of large farms.