Members of the Ukrainian Agri Council (UAC) met with the Minister of Agrarian Policy and Food of Ukraine Vitalii Koval. The discussion was focused on the most important issues of the agricultural sector: access to financing, the functioning of the 5-7-9 preferential loans program and the problems of railway logistics and reclamation infrastructure.

During the meeting, the Chairman of the UAC, Andrii Dykun, emphasized the need for comprehensive support for farmers from the temporarily occupied territories and the urgent signing of bill No. 12148 on suspending their loans by the President:

“Our farmers, whose enterprises are under occupation, have virtually no financial protection. Suspending of loans under draft law No. 12148 is not just a technical measure, but a chance to recover after liberation from occupation,” said Andrii Dykun.

The parties paid special attention to the issue of financing medium-sized agricultural businesses, which, unlike large holdings, have limited opportunities.

“If we talk about medium-sized agricultural businesses, we are currently unable to work directly with international financial institutions - we have tried to work with the EBRD and IFC over the past 10 years. It is expensive and complicated - they have a lot of documents they require, as well as a significant “minimum check”. It is easier for holdings. We, medium-sized agribusinesses, could unite in cooperatives of 10-20 farms and submit applications together, but we do not have a mechanism for patronage dividends. If we set up a cooperative, then, according to the law, we pay taxes both as a cooperative and as a farmer - double taxation. There is a law on cooperation, but we cannot fully use it. And while this mechanism is not in place, we do not have access to the funds that Europe is openly offering today,” said Andrii Dykun.

The 5-7-9 preferential lending program is essential for agribusiness and needs to be further expanded.

“We, as medium-sized agribusinesses, are the most likely to use the 5-7-9 program, and it really works. The 5-7-9 loans are less interesting for large companies because they have direct access to IFC and EBRD funds. We do not have access to them, so this program is the only real tool for us. If it is possible to expand it, let's expand it, especially to livestock,” the UAC Chairman emphasized.

Against the backdrop of large-scale underfunding of the agricultural sector, the Ministry of Agrarian Policy is developing long-term solutions to support farmers and develop agriculture.

“The Ministry of Agrarian Policy is working on these issues. Irrigation and assistance to farmers affected by the war are among our priorities. Separately, we are working on a special program to support farmers in the temporarily occupied territories with compensation for losses and preservation of the material and technical base. We are also working on an initiative to support relocated enterprises based on the principle “money follows the farmer”. Overall, financial support for the agricultural sector is important for the Ministry. According to the World Bank, the sector is underfunded by ₴828 billion. That is why the Ministry of Agrarian Policy is working on a comprehensive solution - long-term programs to support farmers for 3 to 5 years, which will be tied to a percentage of gross value added,” Vitalii Koval said.

Among other issues raised by the participants of the UAC: increasing state support for frontline enterprises, restoring the Ukrzaliznytsia discount for grain exports, changes to minimum export prices, changes to the methodology for calculating land plots by NGO with regard to moisture, transferring reclamation systems to the State Fisheries Agency and solving the problem of the Dnipro-Donbas Canal, supporting the draft law No. 7577 on the transfer of reclamation to state operators, introducing a single freight railway tariff, benefits for relocated agricultural enterprises, and allowing the use of land lease rights as collateral.

The UAC thanks the Minister of Agrarian Policy and Food Vitaliy Koval for supporting the initiatives of the UAC, open dialogue with farmers and constructive meeting.