The purpose of AgroInvest is to provide technical assistance to accelerate and broaden economic recovery in Ukraine and increase the country’s contribution to global food security efforts. AgroInvest is achieving this objective by supporting a stable, market-oriented agricultural policy environment, stimulating access to financial services for small and medium producers (SMPs), and facilitating a more effective market infrastructure for SMPs.
The scope of work identifies three main components, refined into six tasks, as follows:
- Component 1: Support a Stable, Market-Oriented Environment
Task 1-a: Accelerate Market Oriented Reforms
Task 1-b: Strengthen Industry Associations
Task 1-c: Provide Public Education for Land Rights
- Component 2: Stimulate Access to Finance
Task 2-a: Sustainable Access to Financial Services for SMPs Provided
- Component 3: Facilitate Market Infrastructure for Small and Medium Producers
Task 3-a: Producer Organization Development
Task 3-b: Develop Wholesale Markets and Other Market Infrastructure
AgroInvest is a five-year project, extending to an estimated completion date of January 24, 2016. The scope of this project encompasses the following U.S. Foreign Assistance Framework Program Areas: 4.2 Trade and Investment, 4.5 Agriculture, 4.6 Private Sector Competitiveness, and 4.7 Economic Opportunity.
In April, May, and June 2012, the AgroInvest project team continued technical implementation activities in the project focus areas. Key activities and accomplishments during this period included the following:
- The research phase of Land Governance Assessment Framework (LGAF) study has been successfully completed in accordance with LGAF methodology, including preparation of six background reports and holding nine land expert panel sessions involving 36 representatives of NGOs, research institutions, Government of Ukraine (GOU) and business entities.
- In partnerships with USAID and the World Bank, AgroInvest presented and discussed with officials from the GOU the findings and recommendations of the LGAF study. Based on the discussions, a final LGAF report has been drafted.
- The document is currently being finalized between USAID and the World Bank, and will be formally submitted to GOU in August, 2012.
- A grant agreement with the Land Union of Ukraine to implement the Land Rights Resource Center and Web-portal project was signed on June 11, 2012. The Resource Center has been launched, fully staffed, and is operational.
- The grant competition for provision of secondary legal land rights services has been completed, and the winners identified. The program is ready to be launched in seven oblasts in Ukraine.
- Seven agricultural industry associations have been selected through a competitive process for grant awards to build their capacity in advocacy and agricultural policy analysis.
- A subcontract was signed with the winner of the competition for implementation of the Baseline Survey on Land Rights Awareness, Small- and Medium-scale Agricultural Producers Access to Finance, and Agricultural Market Infrastructure; and sampling methodology and instruments for the survey and y were developed.
- Erste Bank Ukraine has agreed to cooperate with AgroInvest in order to develop agrilending to SMPs within their Micro-business department. The main areas of improvement of the bank’s agrilending practices were identified including acquiring knowledge on agrotechnologies for their credit analysts and setting up the software ensuring adequate risk assessment for credit applications of SMPs.
- Partnership with the Ukraine MSME Lending Program, a partner of EBRD Micro-Lending program, was established. The 3-year EBRD Micro-Lending Program will select several Ukrainian banks in order to allow them to access the EBRD loans targeted for increasing MSME financing. The partnership with the Ukraine MSME Lending Program is aimed at supporting development of capacity and volumes of agrilending provided by bank institutions to SMPs. It will facilitate the formulation of a proper legislative framework for developing the banking system with a focus on expansion and increase of the volume of lending to SMPs; allow for the organization and delivery of seminars, round tables, exhibitions and other similar events for representatives from MSMEs and banking institutions actively cooperating with this target group and share experience in development of methodological and other materials aimed at expanding and increasing agrilending to SMPs.
- An innovative approach of developing well-branded software as an instrument of reliable risk assessment for SMPs’ applications by financial institutions was developed.
- A training campaign on issuing titles to land plots was conducted for credit union officers who are engaged in lending to small and medium-sized agriculture producers and will provide informational support on land issues to credit union members’ land owners when receiving loans. A practical guide on forming land plots and issuing titles to land plots for the purpose of extending loans by credit unions to individuals to cover costs of such activities was also developed.
- Three regional training courses entitled “Specific aspect of lending to SMPs” were conducted in various regions of Ukraine. This was the first module of a comprehensive training program intended to enhance techniques of lending to SMPs through credit unions. 52 specialists from 51 credit unions from all regions attended the courses. They will use the knowledge and tools they gained at the training events on practices of lending to SMPs with the assistance from the project.
- A series of trainings on modern agrotechnologies were conducted for SMPs in collaboration with financial institutions and VCAs to increase awareness on the best modern practices and facilitating access to finance for SMPs.
- During the quarter, AgroInvest producer organization development specialists conducted the second round of the post-harvest handling and logistics grant program for producer organizations. The Project received 13 applications from cooperatives and other producer organizations. Six applicants were selected for direct project financial support. AgroInvest provided recommendations to another six applicants, requesting the producer organizations to revise their submissions and reapply in the following round. In addition, two pre-award determinations have been completed and two grant agreements were drafted to support projects on post harvest handling and logistics selected for awards during the first round of the grant program for producer organizations.
- A subcontractor for preparing the design and feasibility studies for development of the regional wholesale market in Rivne has been selected through a competitive process. Studies of production and marketing of agriculture produce in the future market’s supply area have been completed as the first phase of activities under this subcontract.
- As support to a network of five rayon markets/logistics platforms in Kherson oblast, AgroInvest specialists participated in the official opening of the first phase of Hola Prystan, a wholesale-and-retail agriculture market. Additionally AgroInvest announced a tender for making the design and feasibility studies for the second phase of this market.