News Land market
New chapter for agriculture in Ukraine
The impossible land market in Ukraine is a thorn in the side of international politics. Much agricultural land is owned by the government and buying land seems impossible. According to many, breaking open the land market will therefore bring about a much-needed revolution in the agricultural sector. Can the new president Volodymyr Zelensky accomplish this?
Ukraine's agricultural sector is one of unprecedented wealth. It was not for nothing that it was always the breadbasket of the Soviet Union. The country has 42 million hectares of agricultural land. For comparison: Germany has 15,2 million hectares and France 27,8 million hectares. About 25% of all fertile black soil in the world is located in Ukraine.
Comedian as president
At the end of May, Volodymyr Zelensky became the new president of the country. His party took victory in the Ukrainian parliament on July 21. The party won 254 of the 424 seats. Zelensky is a comedian and actor who played the country's president in a comedy series. However, it is the first absolute majority since independence in 1991.
Zelensky has a number of 'impossible' tasks to fulfill, such as ending the war with pro-Russian separatists and actively fighting corruption. In addition, the economy is also in the doldrums. The International Monetary Fund (IMF) language already expresses itself on the economy and the role of the land market in it. This topic was also high on Zelensky's election agenda.
Lots of state property
At the moment it is not possible to buy or sell agricultural land in the country. Much of the land is owned by 3.500 state-owned companies, many of which are no longer active. The land must be privatized if it is up to the IMF. If this becomes a reality, investors from the west will probably invest in the sector.
The end of the year is already mentioned as a deadline for reform and transparency of the land market in the country. Opponents are not happy about that to say the least. They believe that the vast amount of farmland is one of the greatest riches the country has. Selling this to foreign investors is seen as a major threat. The statements of the IMF are therefore received with great skepticism.
Fighting Corruption
To get the land market out of the doldrums therefore requires more than transparency and privatisation. Western investors fear the high level of corruption. In addition, oligarchs have a status quo and dominate the investment markets. This must therefore be tackled at the same time as the land market and that is not an easy task.
Niels van der Boom
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