AgroInvest Final Report: January 2016

In this final report for the AgroInvest project, USAID’s agriculture program in Ukraine from 2011-2016, we discuss the activities and results of AgroInvest in Ukraine. The project’s overall scope of work was developed in 2010 and 2011 to address the issue that Ukraine’s capacity for sustainable, broad-based growth was stalled by unpredictable and incomplete agricultural policies, limited financial services for agriculture, and a weak market infrastructure that led to low yields and made it hard for small and medium producers to become competitive. At a time when agriculture in Ukraine was performing at one-third of its production capability, AgroInvest, implemented by Chemonics International, was developed to assist Ukraine to tap its vast agricultural potential and diversify its sources of prosperity, leading to broader economic recovery and contributing to a more food-secure world.

Severe financial, political, and social crises continue to plague Ukraine. In late 2013, mass protests against the pro-Russian politics of former Ukrainian president Victor Yanukovych triggered his ouster, which, in turn, was followed by Russia’s illegal annexation of the Crimean peninsula and military conflict in the east of Ukraine. In response to separatists’ declarations of unrecognized “people’s republics” in Donetsk and Luhansk through illicit referenda in spring 2014, Ukraine’s newly formed pro-reform launched a full-scale military anti-terrorist operation (ATO) against them. President Petro Poroshenko, elected in May 2014, has steadily pushed for a solution to the crisis in the East. Since the conflict broke out in early 2014, the fighting has resulted in thousands of deaths and massive internal displacement of civilians. According to the United Nations Office for the Coordination of Humanitarian Affairs, the number of internally displaced persons (IDPs) in Ukraine has reached more than one million, the largest displacement of people in Europe since the Balkan wars. Most of these individuals live in eastern oblasts near the conflict areas, such as Kharkiv, Dnipropetrovsk, Zaporizhzhia, and Northern Donetsk. Numerous attempts to broker an end to the conflict have been unsuccessful as ceasefire agreements, commonly referred as Minsk I and II, have been largely ignored. The ongoing conflict has also triggered a financial crisis across the country that has seen the Ukrainian hryvna lose more than 50 percent of its value and has resulted in extensive decreases in domestic and international investment in Ukraine across all sectors.

The ongoing crisis presented unique challenges and opportunities that required rapid and innovative thinking to, in the words of the USAID Mission, “pivot” activities to address the rapidly changing situation in Ukraine. One such challenge was Russia’s illegal annexation of Crimea, where AgroInvest had numerous activities and partners. In mid-March of 2014, AgroInvest (and all USAID programming) had to cease all activities in Crimea. With this crisis came an opportunity; the leadership of the Ministry of Agrarian Policy and Food (MAPF) of Ukraine that came in when President Poroshenko took office was more progressive and open to collaborating with AgroInvest than any other MAPF management team with whom AgroInvest had historically worked.

Yet despite these crises, AgroInvest has achieved outstanding results. Over the life of the project, AgroInvest and its partners helped support the development of more than 75 pieces of draft legislation and the passage of 12 policies, regulations, and administrative procedures through processes that ensured public and stakeholder consultation, facilitate more than $80 million in critically needed agricultural finance, and strengthen the administrative and technical capacities of 20 agricultural service cooperatives and 32 agriculturally focused industry associations. These and other activities and highlights of AgroInvest’s five eventful years of implementation are elaborated on throughout this document.

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