Process Management

News last update:6 Aug 2012

Ukraine to become leading player in grain market

"Ukraine must become one of the leading players on the global agricultural market, particularly the grain market," Ukranian president Victor Yushchenko said in a meeting with Cargill Europe Executive Director Dave Rogers.

Rogers is also a member of Ukraine's Foreign Investment Consultative Council. They spoke about the country's agricultural market, especially grain exports, prices and VAT rebates, as well as how to improve the investment climate and develop ties between government and business.

Yushchenko said the government must find alternative tools to regulate agricultural prices so that producers and traders should be able to sell their products outside the Ukraine, where prices are considerably higher.

He described administrative measures as ineffective, adding that the government did not see "the complex picture of how to manage the grain market" and so failed to liberalise prices.

Rogers said Cargill Europe, as well as many other companies operating in Ukraine, was worried about government interference. Grain export quotas imposed by the cabinet have a negative impact on producers, processors and traders, he complained.

"We would like to know the rules of the game and be informed of agricultural policies the government is going to carry out," Rogers said, adding that his company had sent proposals to the cabinet. Cargill planned to develop the local food processing industry.

As a result of the talks Yushchenko asked tax administration head Anatoly Brezvin to pay back US$18 mln to Cargill and resolve a VAT rebates issue.

Yushchenko said the problem disrupted their efforts to build an effective cooperation with business and attract foreign investment.

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