FARMERS OPERATING AROUND MYRONIVKA, SOUTH OF KIEV, WILL BE ABLE TO OBTAIN MARKETING SERVICES AND FARM SUPPLIES FROM A NEW PURPOSE-BUILT AGRI-CENTER FINANCED BY THE EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT (EBRD). THE EBRD IS PROVIDING A US$ 3.9 MILLION LOAN AND A US$ 3.0 MILLION EQUITY INVESTMENT IN KIEV-ATLANTIC UKRAINE (KAU), WHICH WILL BUILD AND OPERATE THE CENTER.
AT A GROUND-BREAKING CEREMONY HELD TODAY IN THE PRESENCE OF VIKTOR YUSHCHENKO, CHAIRMAN OF THE UKRAINE CENTRAL BANK, EBRD'S PRESIDENT, JACQUES DE LAROSIERE: EXPLAINED: "FARMERS WILL BE ABLE TO EXCHANGE THEIR PRODUCE FOR CRITICAL FARM SUPPLIES, CURRENTLY OUTSIDE THEIR REACH. THIS NEW SYSTEM WILL ALLOW FARMERS TO MODERNISE PRODUCTION METHODS AND INCREASE THEIR OUTPUT AND PRODUCTIVITY WITHOUT THE RISK OF FLUCTUATIONS IN THE CURRENCY MARKETS. WITH SO MUCH OF UKRAINE'S ECONOMY BASED ON AGRICULTURE, NEW WAYS HAVE TO BE DEVELOPED TO MOBILISE ITS HUGE POTENTIAL."
THE EBRD LOAN WILL PARTLY FINANCE THE CONSTRUCTION OF THE CENTER WHICH WILL PROVIDE AGRICULTURAL SUPPLIES, CROP PRODUCTION SERVICES, MARKETING SERVICES, AND STORAGE AND PROCESSING FACILITIES. SUPPLIES, RANGING FROM FERTILISERS AND SEEDS TO VETERINARY PRODUCTS, FARM MACHINERY SERVICES AND FUEL, WILL BE EXCHANGED FOR FARM PRODUCE. CROPS, SPECIFICALLY OILSEEDS, WILL BE PROCESSED AT THE CENTER INTO EDIBLE OIL AND ANIMAL FEEDS, WHICH WILL THEN BE SOLD ON BOTH THE DOMESTIC AND INTERNATIONAL MARKETS TO RAISE HARD CURRENCY TO PROCURE AND IMPORT THE REQUIRED FARM SUPPLIES.
DAVID SWEERE, CHIEF EXECUTIVE OFFICER OF KAU, COMMENTED: "WITH THE STATE ORDER SYSTEM NOW CEASING TO OPERATE, THE CHALLENGE IS TO ESTABLISH A REPLICABLE MARKET TRADING MODEL WHICH PROVIDES A BASE FROM WHICH FARMS CAN BE MANAGED AND OPERATED IN AN INDEPENDENT COMMERCIAL MANNER. THIS COMMERCIAL CENTER IS ONE WAY AND OPENS THE MARKET FOR OTHER ENTREPRENEURS".
KAU IS A SPECIALLY FORMED JOINT VENTURE COMPANY THROUGH WHICH AMERICAN AND GERMAN COMPANIES HAVE FORMED A PARTNERSHIP WITH A NUMBER OF FARMS IN THE AREA. THE COMPANY'S MANAGERS HAVE BEEN OPERATING IN UKRAINE FOR THREE YEARS AND HAVE BUILT UP AN EXTENSIVE NETWORK AMONG THE FARMING COMMUNITY AND DEVELOPED IMPORTANT WORKING RELATIONSHIPS WITH THE LOCAL PARTNERS.
THE PROJECT, WHICH IS THE EBRD'S FIRST AGRI-SERVICE CENTER PROJECT AND FIRST NON-SOVEREIGN AGRICULTURE OPERATION IN UKRAINE, HAS A TOTAL PROJECT COST OF US$ 20.74 MILLION. THE DUTCH EXPORT CREDIT AGENCY, NCM, IS PROVIDING A US$ 5.3 MILLION GUARANTEE. TOTAL INVESTMENT TO DATE IN UKRAINE BY THE EBRD IS NOW ECU 123.72 MILLION.