AgroInvest Paper: Strategic Policy Priority Needs

USAID/Ukraine’s 2011-2015 AgroInvest Project sets forth as the first of its three components, the ambitious aim of supporting a “stable, market-oriented policy environment” resulting in accelerated policy reforms, stronger industry associations and the protection of land rights for Ukraine’s small- and medium-scale agricultural producers, processors, traders and retailers (SMPs). This paper outlines the strategic priorities for the AgroInvest Project’s five-year policy reform agenda.

Building upon a detailed policy environment assessment that the AgroInvest Team completed in May 2011, this policy reform agenda defines five major areas for policy analysis and reform:

  1. Trade policies,
  2. Taxes and subsidies,
  3. Financial market and credit policies,
  4. Land market development,and
  5. Market infrastructure investment.

These five areas further break down into a total of 18 discrete but complementary reform initiatives during the project’s five-year life, and these in turn include 37 discrete policy reform activities that the AgroInvest Team may undertake.

Section I below provides a summary review of the challenges and issues facing Ukraine in each of the five major policy areas. It points to some of the inconsistencies between the Government of Ukraine’s (GOU’s) long-range strategic goals for agriculture, and the current array of policies and regulations that on balance tend to punish agricultural producers and agribusiness in the name of protecting food consumers from high prices and assuring Ukraine’s national food security.

The balance of this paper (Section II) describes the screening process, driven by five basic criteria, by which the AgroInvest Team has identified policy reform priorities. It then lays out the resulting Component 1 strategic policy reform agenda. The policy agenda is broken down into three phases, corresponding to the AgroInvest project years, as follows:

  • Short-term: years 1 and 2 (February 2011- September 2012),
  • Medium-term: years 3 and 4 (October 2012 – September 2014), and
  • Long-term: years 4 and 5 (October 2014 – January 2016).

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