Five key grain sector players in Ukraine, including the Ministry of Agrarian Policy and Food, the Ukrainian Grain Association, the Ukrainian Agrarian Confederation, the Agrarian Markets Development Institute and the European Bank for Reconstruction and Development have today signed a memorandum, establishing key principles for the functioning of a transparent grain market in the country. The signing ceremony was attended by all major international and local grain companies operating in Ukraine.
Today’s signing is a result of a joint initiative of the EBRD and the Ministry of Agrarian Policy and Food aimed at the development of the domestic grain sector. The initiative is to tackle regulatory inefficiencies in the sector, to promote transparent, predictable long-term policies and to improve the attractiveness of the Ukrainian grain sector as a target for investments.
The results of the initiative will be an important step for a country which has the potential to produce around egihty million tonnes of grain every year and which aspires to establish itself as a leading global food supplier. Thus Ukraine is poised to potentially play a key role in addressing the issue of the global food security. The country also should be able to attract multi-billion investments into its agribusiness sector once the right laws and regulations are in place.
According to the memorandum, the parties will work closely on harmonising the relations between grain sector regulators and private operators. This will include drafting of legislation aimed at the introduction of new pre-harvest financing instruments and new standardisation and certification principles. Private companies, in their turn, are committed to invest in grain storage and transportation facilities as well as to work with the Ukrainian farmers to promote and develop highly efficient production and grain processing technologies. The Ministry of Agrarian Policy and Food will engage in early consultations with key stakeholders before introducing or proposing normative acts affecting private participants in the grain sector.
“The agribusiness sector and its grain segment are very important for the EBRD in Ukraine. Only last year we committed almost $100 million to grain sector projects in this country”, said Gilles Mettetal, EBRD Director for Agribusiness. By supporting this initiative, we demonstrate our belief in Ukraine’s ability to become a major grain producer and exporter, which is especially important in the light of the global food shortages, he added.
The European Bank for Reconstruction and Development is the largest financial investor in Ukraine. As of 31 December 2011, it had committed over €6 billion through 264 projects.