• Українською
  • State Property Fund presents the Land Bank: how it will affect the agricultural land market
    State Property Fund of Ukraine, posted 17 September 2024 14:30

    On 17 September, the State Property Fund of Ukraine presented the Land Bank project, which will transform the market of state agricultural land. The event was organised by the SPFU in partnership with the USAID / UK aid State-Owned Enterprises Reform Activity (SOERA) project. The presentation was attended by representatives of the Parliament, the Government, international organisations, the diplomatic corps and business. The event became a platform for discussing the project’s prospects and its importance for Ukraine’s economic development.

    “The Land Bank is an opportunity for tenants to invest under transparent and clear rules on competitive market conditions. This is necessary to create new agribusinesses and stimulate the development of existing ones. In fact, the Land Bank is an effective way to increase investment in the agricultural sector. The project aims to create a transparent agricultural land lease market and increase budget revenues from land use. All of this adds up to economic development, increased tax revenues, job creation and efficient use of the state’s available resources,” said Oleksii Sobolev, First Deputy Minister of Economy of Ukraine.

    “The Land Bank offers farmers the opportunity to lease state land on a transparent and competitive basis through online auctions in the Prozorro.Sale system. As of today, 45 auctions have already been announced in the system in Vinnytsia, Lviv, Volyn, Cherkasy, Zaporizhzhia and Odesa regions, covering an area of 2 to 262 hectares. The first auction will take place on 1 October. In total, 1,905 land plots totalling about 100,000 hectares will be leased by the end of the year.

    The reform of the state agricultural land market will have a powerful economic and anti-corruption effect and will be of great importance in supporting business. The Land Bank will gradually bring hundreds of thousands of hectares of state-owned land out of the shadows. For decades, they have not been useful to our country, they have not been properly cultivated, and corruption schemes have been formed around them. In contrast, competitive and open land leases will help to fill the budget. The estimated total revenue from the lease of the first pool of plots is expected to reach UAH 1 billion. And the land resources offered by the state will encourage farmers to develop their business, create new companies or small farms,’ said Ivanna Smachylo, acting Chair of the State Property Fund of Ukraine.

    Currently, the SPFU is also working on the second pool of the Land Bank. According to Ivanna Smachylo, it will include about 250,000 hectares. This stage of the project is scheduled to be implemented in 2025.

    An interactive map of land plots was also presented at the event, which is now available at landbank.spfu.gov.ua.

    The map shows the exact location, size, starting price and bidding status of each plot, its cadastral number, designated purpose, etc.

    The tool is convenient and easy to use, and will help auction participants find a specific plot in the selected region. The resource provides all the information about the land and directs bidders to the auction page if it has already been announced.

    “The agricultural land market is one of the most competitive in the system. On average, more than three bidders compete for such plots at open online auctions. As a result of the competition, the cost of leasing communal agricultural land at auctions increases by almost 3.5 times. Thus, since the beginning of the reform, communities have received over UAH 642.2 million annually. We expect that this experience will be extended to new types of land in the system – state-owned plots in the Land Bank,” said Sergiy Boote, CEO of Prozorro.Sale.

    The implementation of the Land Bank project is an important step in reforming the management of state assets, which will increase the efficiency of agricultural land use, increase revenues to the state and local budgets and create transparent conditions for access to the market for all participants.