Ukraine: in 2020, the investment volumes in agriculture to decrease — Institute of Agrarian Economics




According to the forecast estimations of scientists of the Institute of Agrarian Economics, under the existing conditions of investment activities, in 2020 the general volumes of capital investments in the agricultural production in 2019 prices will total nearly 2 bln USD, a decrease of 5% compared with 2019, declared the Head of the department of innovations, inventory and logistics support at the National Scientific Center “Institute of Agrarian Economics”, Doctor of Economics, Oleksandr Zakharchuk, on May 17.

In terms of worsening of the situation, and in case of the synergy of the existing and new negative factors, including worsening of the financial condition of enterprises, decreasing of the rates of realization of investment projects in the agro-industrial production, as well as the global economic crisis caused by the COVID-19 pandemic, the scientists can expect for some reduction of investment volumes by additional 15-20%, O.Zakharchuk stressed.

Also, he noted that launching of the agricultural land turnover may become a new negative factor, since the land market should start working in Ukraine after July 1, 2021.

To date, agricultural producers already started thinking about providing their activities with land resources at the level of no more than 100 ha per person. Therefore, creating of a farm of three people requires finding of funds for 300 ha. In terms of the minimum costs of 1`000 USD per 1 ha, such funds will total at least 300 thsd USD. Therefore, some funds that farmers could have directed to invest in the agricultural sector development in the current year, will be blocked, the expert said.

According to calculations of the Institute of Agrarian Economics, in 2020 the volumes of foreign direct investments in the Ukrainian agriculture will vary at the last year level, and total nearly 560 mln USD.