At the end of the first half of 2014, foreign direct investment in agriculture, forestry and fisheries in Ukraine decreased by US$ 104,1 million or 13,4% to US$ 672,5 million, compared to the total investment at the beginning of the year. This was reported in the Association “Ukrainian Agribusiness Club” (UCAB).

During early armed hostilities in the eastern region of Ukraine it was obvious that it would result in dropping of investors’ interest because forecasting of developments in such conditions would be impossible. The flight rate of investments from agriculture was even larger than in the whole economy.

Thus, foreign direct investment in all types of economic activities of the state decreased by 11,9% to US$ 50 billion in the first half of 2014, while the share of agriculture, forestry and fisheries within this figure decreased from 1,4% to  1,3 %. Agriculture took the sixth place in terms of reduction rate in foreign direct investment. The  first place  - art, sport, entertainments and recreation – - 20,3% (-US$  31,8 million), the second -professional, scientific and technical activities - -17,3% (-US$  693,5 million), the third – financial and insurance activities - -15,8% (-US$ 2,4 billion), the fourth - transportation, storage, postal and courier activities – 15,6% (-US$ 238,8 million.), the fifth -  other services - -13,5% (-US$  3,9 million), the sixth place - agriculture, forestry and fisheries.

At the same time, capital investment in agriculture, hunting and providing related services amounted to UAH 6,3 billion in January-June 2014, which is 18% lower than the same period last year due to the drop in profitability of agrarian manufacture and the tightening access to credit resources.  

“Along with the obvious influence of the military-political and macroeconomic situation, according to the investor's opinion, permanent offers of the Ministry of Finance in regard to revision of the taxation system in agriculture also have its influence, as well as cases of long-lasting pressure on real business, as in the case with “Agrein“, - comments expert of agricultural markets from the Association “Ukrainian Agribusiness Club” (UCAB) Igor Ostapchuk.

Association "Ukrainian Agribusiness Club"  

3 floor, 146 Zhylianska Str.

01032 Kyiv, Ukraine

Phone/Fax: +380 44 2362097/79

[email protected] 

Tetyana Kotyk 

www.ucab.ua 

The Association "Ukrainian Agribusiness Club" (UCAB) www.ucab.ua  was founded in 2007 to protect the economic and professional interests of players of agribusiness in Ukraine. UCAB is a unique platform in Ukraine for establishing business contacts between the leaders of agribusiness, improvement their work and dialogue with the government. UCAB actively supports Ukrainian producers in establishing and maintaining international business relations. The Association consists of the largest producers and processors of agricultural products in Ukraine.