Farmland prices in Ukraine may grow threefold, once the moratorium is off — World Bank

The World Bank is ready to enhance the financial assistance of Ukraine, if a moratorium on the sale of agricultural land is lifted, EPravda writes.

Satu Kahkonen, the World Bank Country Director for Belarus, Moldova, and Ukraine, believes that in this case, farmland prices will rise.

The World Bank projects that prices will grow to USD 3-3500 per ha, compared to USD 1-1500, which are currently present in the market.

"The business is ready to pay more for certainty and the opportunity to avoid investment risks. The technical work on lifting the moratorium in Ukraine is almost complete," Kahkonen notes.

She stressed that this would lead to an increase in financial assistance to Ukraine.

Kahkonen also added that landowners in Ukraine get the lowest price for renting land in Europe, while the quality of Ukrainian soils is one of the highest in the world.

In late 2017, MPs of Ukraine voted in support of the recommended by the agrarian committee bill No. 7350 on the extension of the moratorium on the sale of agricultural land for another year. The moratorium has been in effect for 16 years now.

Today, landowners in Ukraine are only individuals who are now virtually deprived of the right to dispose of it. Thus, all Ukrainian agricultural enterprises cultivate only leased land. However, experts argue that the shadow market of land in Ukraine exists.

Yet, the IMF recommends Ukraine to open a land market. According to the Fund's data, the launch of the land market in Ukraine and the adoption of the relevant legislation will allow to unleash a significant potential for economic growth, as well as to ensure substantial revenues for the state, including tax revenues.