The discussion was held on the proposals received from businesses as part of the work of the Sectoral Working Group on Agro-Industry, established under the Ministry of Economy of Ukraine, organized by the Kyiv School of Economics and moderated by Deloitte as part of the work on the Ukraine Facility Plan. More than 120 participants took part in the group’s work, contributing 25 proposals for policy changes, 15 of which were submitted to the Government for possible implementation.
Creation of the sectoral working groups is one of the activities under the Good Governance Fund Project “Economic Hub: Sound PFM Policies and Vision for Growth,” which is supported by the UK government (UK Aid). The project delivery partners are Abt Britain and Kyiv School of Economics.
The proposals received were related to the fields of crop production, livestock production, raw material base, deep processing and infrastructure. The proposed changes concern state regulation, the process of European integration and harmonization of Ukrainian legislation with the EU, access to financing and markets, as well as the development of human capital and technology.
Some of the proposals have already been included in the Plan, such as the strengthening of relevant institutions and regulatory frameworks by complying with EU requirements, supporting value added chains, as well as harmonizing sanitary and phytosanitary standards with EU norms.
“The agricultural sector holds a significant place in Ukraine’s economy, contributing on average about 10% to the GDP and over 40% to export earnings. At the same time, the sector has substantial potential for development, and our work with businesses helps to define priorities for the industry. The results of the group`s work will be taken into account during the preparation of the Plan and proposed for inclusion in the sectoral development strategies,” said Deputy Minister of Economy of Ukraine Oleksii Sobolev.
He also added that the Ukraine Facility program includes a special investment instrument to cover risks in priority sectors, with a total of EUR 8 billion. This is expected to attract over EUR 30 billion to the Ukrainian economy. Investors will be able to obtain financing through the EBRD, EIB, and other international financial institutions.
In addition to policy change proposals, participants of the sectoral group provided 88 proposals for potential investment areas, with a total budget of over $3 billion. Most opportunities were related to the processing industry (34), livestock production (19), and infrastructure (17). At the same time, the needs for agriculture recovery and reconstruction amount to $29.7 billion from 2023 to 2033, and $2.6 billion for the restoration of irrigation systems from 2027 to 2033.
“The group’s work shows that enterprises in the agro-industrial sector respond effectively to challenges, adapt to the dynamic environment, restore their activities, and launch new investment projects. The implementation of the received proposals will contribute to the development of the industry. After five expert discussions, 15 policy proposals were submitted for possible implementation,” said Maksym Fedoseienko, Head of Strategic Projects at KSE Institute.
While the format of the Ukraine Facility Plan does not foresee investment projects, their analysis is important for identifying priority sub-sectors for development. The relevant proposals will be submitted to the Ministry of Agrarian Policy and Food of Ukraine for consideration and may be included in the development strategy of the agro-industrial sector until 2033.