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Modern economic POTENTIAL OF UKRAINE |
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AgricultureThe period of 1991-2005 in Ukraine was marked with significant changes of social and economic relations and formation of fundamentally new economy. Its main attributes (financial monetary, budget, banking, customs, and other systems which in aggregate determine economic infrastructure of an independent state) have been formulated in fact from nothing. The state experienced protracted economic crisis over 1991-1999 which was followed by significant drop in GDP, industrial and agricultural production, and reduction of salary. Meanwhile, situation in the country has drastically changed over the last five years. Policy of that period resulted in high rates of economic growth, stability of national currency, and positive shifts in the sphere of individual life support. On the other hand, social and economic indices per capita are still extremely low in nominal figures. However, experts predict further growth for Ukraine. Agriculture would have a great influence in growth of national economic indices. Ukraine has enormous potential in this sphere. It has extensive capacities for further development of agrarian sector and transferring it into highly efficient export-capable sector of economy. Then it would be able to maintain food security of the state. Approximately one third of European black earths and 27% of ploughed lands are at the heart of Ukraine. This constitutes about 0.68 ha per capita in Ukraine and 0.25 ha in aggregate in Europe. Formation period of new business relations, which were built on principles of private property for land and belongings and creation of economic prerequisites for stirring up of economic activities, took place in agriculture of Ukraine over the few last years. As a result, sizable changes occurred in the region, in particular, role of individual economies in agricultural production significantly expanded. Area of agricultural lands owned and cultivated by individuals increased more than one and a half times since 2000 and amounted to 13.8 mn ha as of early 2005. This is a year-on-year growth of 8% over 2004. Approximately 59 ths. agricultural companies operate in Ukraine with the area of agricultural lands at roughly 22.9 mn ha. Joint stock companies, private, state, and other enterprises constitute 16 ths. of the total number. Companies with the area up to 100 ha made 11.6% of the enterprises, from 100 to 500 ha respectively 20% of the companies, from 500 to 1,000 ha – 15.6%, from 1,000 to 2,000 ha – 20.3%, and over 2,000 ha – 20% (data as of beginning of 2005). Average size of a commercial farm exceeded 1,300 ha of agricultural land. More than 42 ths. farms which owned and used 3.4 mn ha of agricultural land including 3.2 mn ha of ploughed land were registered as of the beginning of 2005. Average size of farms grew by 9 ha if compared to 2004 and measured 80 ha. Approximately 3.8 mn people were involved in agriculture activities including more than 42% working in personal part-time farms. Agriculture including hunting and forestry created 12.1% of gross added value of all economy industries in 2004. Ukraine’s agricultural produce volume is estimated to have amounted to UAH 92.5 bn in 2004 (UAH 83.5 bn in 2003) in actual prices. The trend over the few last years regarding production and sales of agricultural produce has been positively reflected in the financial and economic state of agricultural companies. Specifically, the net result of all commercial-scale agricultural enterprises activities in 2004 constituted positive UAH 2.6 bn against a UAH 4.6 mn loss in 2003. The average profit was 12.6%. Roughly 66.1% of agricultural enterprises were profitable in 2004, and this totaled UAH 3.6 bn. The profit per company average equalled UAH 584.4 ths. |