KYIV, Sept 19 – Ukraine’s President Leonid Kuchma said on Tuesday the government should increase financial aid to the country’s troubled farm sector in 2001 in a bid to boost agricultural output in coming years.
Speaking at a news conference with regional media, Kuchma said Ukraine would never boost its agricultural output without large-scale credits and the government had to include such funds in the 2001 draft budget.
“The government promised that Ukraine would harvest 40 million tons of grain next year, but I’m sure that in addition to that declaration it must adopt a series of measures, including a credit program,” Kuchma said. Officials say Ukraine, which harvested some 50 million tons of grain annually in Soviet times, will approximately match the meager 1999 harvest this year, bringing in around 24.5 million tons of grain.
The prime minister, Viktor Yushchenko, said in August Ukraine planned to increase its grain harvest to at least 35-40 million tons next year but did not elaborate on the measures the government planned to boost grain output.
Analysts say farms have no money to buy fuel and modern machinery even to harvest this season’s crop and farmers complain that they cannot get credits from commercial banks because of high interest rates.
Bankers say most farms are bankrupt and unlikely to repay loans. Official data show that some 85 percent of Ukraine’s 12,687 farms made losses in 1999.
Last year Kuchma ordered all Soviet-era farms broken up by April, promoting private land ownership in the country’s farm sector. In line with his decree, all collective farms have been transformed into private farms or cooperatives.
This year the government released Hr 175 million ($32.2 million) to help offset high interest rates on commercial credits, saying it allowed hard-up farms to attract loans worth a total of $1 billion.
