Will Ukrainian Chernozems be sold to foreigners? / News / News agency Inforos
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Will Ukrainian Chernozems be sold to foreigners?

Foreign companies have taken control of 2.4 million hectares of Chernozemic soils in Ukraine

Will Ukrainian Chernozems be sold to foreigners?

Selling agriculture lands in Ukraine was legally banned in 2001. The adoption of the law back then was considered as a temporary measure; however, the ban was regularly prolonged and has been valid until now. Ukrainian non-residents only can rent agriculture lands for up to 50 years.

While Ukrainians fought with incumbent authorities during Maidan revolutions, Western investors profited from this right purchasing Chernozemic soils in Ukraine. According to a number of foreign organizations (the Oakland Institute, Land Matrix Initiative and some others) foreign companies have gained control over up to 2.4 million hectares of Ukrainian Chernozems, which is accounted to about 5% of Ukrainian agriculture lands.

Now "Europe's granary" is the world's second as far as agriculture areas controlled by foreign investors are concerned, allowing just Indonesia (3 million hectares) ahead. The majority of it, about 2 million hectares, is controlled by seven companies from the USA, China, Cyprus, Denmark and Germany.

The Americans own the major part of agriculture lands. American NCH Capita is one of the largest investors (over 400,000 hectares). It has been renting small land plots (from 2 hectares to 6 hectares), later merging them into large farms of industrial scale. Other large landowners are the corporations Monsanto, Cargil and DuPont. Michael Cox of the Piper Jaffray investment bank noted "Ukraine and, to a wider extent, Eastern Europe, are among the most promising growth markets for farm-equipment giant Deere, as well as seed producers Monsanto and DuPont."

Ukraine does not allow the use of genetically modified organisms in agriculture, but Article 404 of the EU agreement includes a clause that both parties will cooperate to extend the use of biotechnologies. There is no doubt that this clause meets the expectations of such Western agriculture companies as Monsanto. So, gaining control over Ukrainian Chernozem was likely to be one of the goals of the past 2 Maidan revolutions funded by the Americans.

Ukrainian expert Valentina Goydenko believes that acquiring rights to Ukrainian lands is a "great opportunity to govern the vast territory as the West rather than Ukraine and its people deem it necessary." Proving this opinion, the main sponsors of the "independent" Ukraine, the IMF and the World Bank, have constantly been linking new loans to the weakening of state control in the agriculture sphere, including trade in genetically modified organisms and restrictions on selling lands. Moreover, the IMF has many times insistently advised Ukraine to take stock of its state lands, as there is no complete information on the amount of land plots owned by the government and their values are vague;

Noteworthy, previous president of "independent" Ukraine Petro Poroshenko took a dual approach to selling agriculture lands to foreigners. On the one hand, he many time spoke publically against the moratorium on the sale of agriculture lands, saying that the ban hinders the flow of investments and the development of the agriculture market and deprives a significant number of Ukrainian citizens of their constitutional rights to dispose at their own volition of their lands.

But his conflict with former Prime Minister Yatsenyuk, who said in 2016 that it was needed to continue the land reform and sell 1 million hectares of state lands at an open and transparent auction, indicated that his real position differed from the stated. Poroshenko is a large landowner: his business empire comprises the group of companies Agroprodinvest that rents 92,000 hectares of lands. Former first deputy chief of the Ukrainian presidential administration Yuriy Kosyuk, the owner of the company Mironovsky Khleboprodukt, operated 280,000 hectares of lands.

Another agriculture businessman considered to be close to the former president is Oleh Bakhmatyuk, the owner the company Avangard and the agriculture holding Ukrlandfarming, who rents over 500,000 hectares. Andriy Vadaturskiy, a Verkhovna Rada member from the Petro Poroshenko Bloc, is a top 20 agriculture producer in Ukraine. He together with his father Oleksiy Vadaturskiy rents 80,000 hectares. That is why the previous presidential administration took the line of supporting large national agriculture producers. At the end of this presidential term, Poroshenko signed Law No. 2666-VIII extending the moratorium on the sale of agriculture lands until January 1, 2020.

Incumbent Ukrainian President Volodymyr Zelensky takes a different stance. He said several times during and after the election campaign that it was time for the "independent" Ukraine to allow the sales of agriculture lands with their prior audit. Meeting with businessmen on June 20, he said: "Ukraine should get rid of the outdated Soviet regulation that was in the planned economy, that is a ban for an adult to freely dispose of his property, which is land, and forex reserves… These bans must be cancelled."

So, it is likely that the sale of almost the last precious assets of "independent" Ukraine is right round the corner.

Even Maidan revolutionaries are shocked by this president's decision. For example, a consistent Maidan revolutionary Oleh Lyashko, who leads the Radical Party, said at a session of the Verkhvna Rada: "I want to explain why we oppose Zelensky. That is because Zelensky wants to sell Ukrainian Chernozems to foreigners. We think this is a crime against people. This kills Ukrainian villages."

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