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 January, February, and March 2012, the AgroInvest project team continued technical implementation activities in the project focus areas and established a new project presence in Kherson, facilitating outreach across southern Ukraine. Key activities and accomplishments during this period included the following:
- The project put major effort into monitoring and responding to changes to the draft Law on Land Market. After the first reading of the law in the Verkhovna Rada in November 2011, AgroInvest succeeded in achieving two of its key advocacy positions, i.e. removing the exclusive right of the State Land Bank to issue mortgages for agricultural land and removing the 6-month limitation on commercial banks holding land on which they foreclose. Nevertheless the continued unclear role that the State Land Bank would play in the new market, along with draconian limits imposed on land leasing, meant that AgroInvest also supported suspension of the law in its current form. This was effected in conjunction with project partners in February 2012.
- The second phase of the National Land Rights Media Campaign was conducted during this quarter, consisting of four media training sessions covering the remaining 10 oblasts of Ukraine and involving a total of 223 journalists. 131 pieces of press coverage on the issue of the pending land market and its implications for rural landowners and farmers were registered reaching an estimated 17 million Ukrainians.
- The World Bank/AgroInvest Land Governance Assessment Framework (LGAF) initiative was conducted intensively through the quarter, with seven Expert Panel Sessions, involving 30 Government of Ukraine (GOU), non-governmental organization (NGO) and independent professional experts gathering to evaluate Ukrainian land governance mechanisms, prior to presentations in to the World Bank in Washington and GOU in Kyiv in April and May 2012, respectively.
- AgroInvest responded to the Ministry of Agrarian Policy and Food’s (MAPF) requests to support the development of a series of revised pieces of legislation governing agricultural cooperative organization and taxation. AgroInvest, also on the request of the Ministry, engaged the Union of Agricultural Cooperatives to develop model cooperative statutes for discussion, formal approval and dissemination for use, in conjunction with training across the country.
- AgroInvest signed a bridge subcontract with the Agrarian Markets Development Institute (AMDI) on January 31, 2012, enabling AMDI to engage in priority policy issues, including the provision of secretarial support to the new Public Council under MAPF, which began gathering approximately 40 industry associations on agricultural policy issues, using this as the primary vehicle for furthering its technical policy work refining the draft Law on Agrarian Receipts and refining the Law on Warehouse Receipts.
- Over 15 new agricultural small and medium producer (SMP) lending products were developed during the quarter for national and regional banks as well as credit unions, with a particular focus on Crimea and Kherson oblasts. Of these credit products, two have received formal approval by the boards of the relevant financial institutions, and all are undergoing fine-tuning and presentation to target audiences of SMPs. One, a new title deed registration product for credit unions, was finalized during the quarter.
- US Farm Credit System expert Vickie Cosentino conducted a review of the Ukrainian credit union system and lending practices, compared it to the US experience, developed recommendations, and delivered a successful training to over 58 representatives of the two project-supported national credit union association task forces.
- AgroInvest producer organization development specialists conducted the first round of the post-harvest handling and logistics grant program during the quarter. The Project received 11 applications from cooperatives and producer organizations. AgroInvest provided input to five applicants, requesting them to revise their submissions and reapply in the following round. Three applicants were selected for direct project financial support.
- Market infrastructure work focused on gaining MAPF recognition of status and developing feasibility studies for the regional wholesale market in Rivne. Support to a network of five raion markets/logistics platforms was also agreed in Kherson Oblast and implementation work initiated. In Crimea, the Project provided consultations on market organization and conducted initial work on feasibility study design for two local logistics centers.