Economics and management of national economy

Regional leadership of agrarian production in Ukraine: assessment, problems and directions of development

Economic Annals-XXI

Economic Annals-ХХI: Volume 182, Issue 3-4, Pages: 90-105

Citation information:
Kuzmenko, O., Semenchuk, I., & Pohromskyi, V. (2020). Regional leadership of agrarian production in Ukraine: assessment, problems and directions of development. Economic Annals-XXI, 182(3-4), 90-105. doi: https://doi.org/10.21003/ea.V182-10

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Oleksandr Kuzmenko
D. Sc. (Economics),
Professor,
Head, Economics and Business Department,
Petro Mohyla Black Sea National University
10, 68 Desantnykiv Str., Mykolaiv, 54003, Ukraine
oleksandr.kuzmenko@chmnu.edu.ua
ORCID ID: https://orcid.org/0000-0002-6192-5483

Iryna Semenchuk
PhD (Economics),
Associate Professor of the
Department of Economics and Business,
Petro Mohyla Black Sea National University
10, 68 Desantnykiv Str., Mykolaiv, 54003, Ukraine
irina.semenchuk@chmnu.edu.ua
ORCID ID: https://orcid.org/0000-0003-0425-887X

Viktor Pohromskyi
PhD (History),
Acting Associate Professor,
Petro Mohyla Black Sea National University
10, 68 Desantnykiv Str., Mykolaiv, 54003, Ukraine
pogromski_y@ukr.net
ORCID ID: https://orcid.org/0000-0002-6387-240X

Regional leadership of agrarian production in Ukraine: assessment, problems and directions of development

Abstract. The leading regions of Ukraine’s agricultural production are the most eye-catching for attracting foreign investments, introducing innovative technologies and entering international markets. Research of the main factors, characteristics and experience which determine the agricultural guidance of the regions provide information to the potential investors for the accomplishment of investment and innovation programs, identify problems and ways to solve them for further expansion of the agricultural sector.

The study applied the method of estimating the level of agricultural production in terms of gross agricultural output per one person of the rural population (GAO per one person of the rural population). The evaluation of the leadership of agricultural production in the regional aspect was carried out on the basis of the Ukraine’s regional allotment into three groups, formed by the ranges of the ratio of GAO per one person of the rural population to its average value in Ukraine. A group of regional leaders from 15 oblasts (regions) that form the leading agricultural district (Vinnytsia, Dnipropetrovsk, Donetsk, Zhytomyr, Zaporizhzhia, Kyiv, Kirovohrad, Mykolaiv, Poltava, Sumy, Kharkiv, Kherson, Khmelnytsky, Cherkasy, Chernihiv) has been established. In these oblasts, agricultural products worth UAH 525298.1 million are produced. (77.1% of the volume in Ukraine), is sold for export for USD 8181.0 million (40.3% of Ukraine’s agricultural exports). It is determined that in the leading district the area of agricultural lands is 27.2 million hectares, 82.7% of which are arable lands of fertile chernozem. The structure of production has changed towards crop production, the most profitable and export-oriented one. The rural population has shrunk to 7.1 million, reducing its labor potential. More than 77% of agricultural machinery is concentrated in the district, but this is on the background of its overall reduction by 3.5 times or even more (in 2019 compared with 1990).

The main problems in land use are: high degree of plowing of agricultural lands (the highest in five oblasts reaches 81.5-88.1%), violation of the system of scientifically justified crop rotations, insignificant application of organic fertilizers (0.1-1.3 t/ha), which intensifies soil degradation processes. Investments in the leading agricultural district of 15 oblasts amount to UAH 45.3 billion, or 77.3% of the total volume in Ukraine, but their main part (65.4%) is own funds of enterprises and organizations and only 0.7% are the funds of foreign investors. The influence of farms’ categorical factors and the scale of commodity production on certain types of products is analyzed and a significant influence on the leadership of large agricultural associations (agricultural holdings) is revealed.

The system of internal and external factors influencing the leadership of the regions is generalized in our study. The measures of the state agrarian policy should be intended to transition to production of products with high added value, optimization of land use system, improvement of investment climate, rendering of the state help to agrarian producers, development of infrastructure and system of logistics, information and legal support of agrarian export, introduction of innovative technologies in the field of decision making in farming.

Keywords:  Agrarian Production; Region; Leader; Group; Agricultural Land; Agricultural Holding; Crop; Export; Investment

JEL Classification: O52; Q1; R11; R12

Acknowledgements and Funding: The authors received no direct funding for this research.

Contribution: The authors contributed equally to this work.

DOI: https://doi.org/10.21003/ea.V182-10

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Received 21.02.2020
Received in revised form 5.03.2020
Accepted 16.03.2020
Available online 15.04.2020
Updated version of the paper as of 27.07.2020

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