Capital investment in agriculture, forestry, fisheries shrinks by over 45%

The Ukrainian Agribusiness Club Association (UCAB) says capital investment in domestic agriculture, forestry, and fisheries shrank by 45.3% in 2020 against 2019, to indicators of 2009.

Read alsoZelensky enacts law on VAT reduction for agri-importsOver the period under review, UAH 36.4 billion (US$1.3 billion) was injected into the agricultural sector, which accounted for 9% of total capital investment, the UCAB's press service wrote on Facebook on February 26.

"The decline in capital investment in agriculture has been observed for the second consecutive year. If capital investment decreased by a mere 10% in 2019, it fell by almost 33.4% in 2020. The last time such a decline was observed during the global economic crisis in 2009," the press service added.

Experts list several causes behind the decrease in investment:

• Expectation of the forthcoming launch of the farmland market, which was tentatively scheduled for October 2020, and the accumulation of financial resources by farmers;
• Projected low profitability of agricultural production in early 2020;
• Shortage of harvests for most crops; and
• Economic uncertainty and coronavirus-related curbs.

Background

In total, capital investment in Ukraine in 2020 stood at UAH 419.84 billion (US$15 billion), which was 38.2% down from 2019, according to the State Statistics Service.