Export development is more than just a tool for profit. It is inclusion into an international process, and the ability to be a link in a chain of economic relations. Ukraine is strategically developing its agriculture sector, but it is important to overcome the status of being a mere resource base. How can we do that? With the help of new technology.
An agricultural investment forum was recently held in Kyiv with the participation of representatives of governments and the agro-industrial complexes of Saudi Arabia and Ukraine. Foreign partners are waiting for the same kinds of developments as are always with relation to Ukraine: a better investment climate, more transparency, more export orientation, and more openness. As always, Ukraine expressed confidence in being able to develop cooperation. Now the main thing is to realise all our plans.
In fact, at present, there is positive development of exports to Saudi Arabia. In the first nine months of this year, Ukraine had increased sales of agricultural products by 17% compared to the same period last year. In purely financial terms, we are talking about $362.9 million. Also of importance is the fact that Saudi Arabia is extremely interested in the possibilities that exist in Ukraine’s agriculture sector. An example of this relates to one of the largest deals in this sector in recent years – a $242 million acquisition of the Mriya agricultural holding company by SALIC, the Saudi Agricultural and Livestock Investment Co, in September of this year. I’m sure that this is not the last such deal we will hear about, and in the coming years we can expect to see similar events. However, I consider it important not to follow the magic of impressive numbers only, as this can block investigation into other ways of development.
First of all, today we need to understand that in the 21st century, we no longer sell just the sun, the air, and the fertile black soil. Agriculture all over the world is now a technological sphere, which enables a significant increase in yields, as well as helps deliver more stability in the sector, reducing the impact of things like drought and other adverse issues. The development of M2M systems, alternative energy, and blockchain too are all solutions that can work together with agribusinesses and help provide individual companies with competitive advantages. Many Ukrainian enterprises have already understood this, but technological renewal should not be just be an initiative of a particular business, it should be a common strategy.
Ukraine is the first in the world in the production of sunflower and sunflower oil, leading in the supply of rapeseed, honey, corn, and wheat. The share of the agricultural sector in total exports from Ukraine is 34%. But business requirements for leaders are always higher than for beginners. We are not new and considering our position we do not have the right to be so selective about technology. On the contrary, in order to maintain our current international market position and develop, Ukraine must understand that it’s the innovations embedded in successful business projects that will allow companies to reach new levels of success.
Yes, we can say that for a long time our agricultural sector developed in spite of, and not thanks to, certain local conditions. And even now things are still not simple: the moratorium on the sale of land being a perfect example of issues negatively affecting this sector. At the same time, it is necessary to understand that it is precisely for this reason that considerable technological renewal and a bet on higher predictability are necessary, along with lower risks. This will allow more profitability and at the same time open the way for more predictable partners, which means working with partners looking for our exports will in fact be simpler.
Developing the agricultural sector as an export leader does not mean just being a source of raw materials for partner countries. It means operating predictable and sustainable businesses, which will allow the Ukrainian economy to attract more funds for development and businesses to build on their present momentum, widening their scope of operations. All the basic features for this can be found in Ukraine. The main thing is to use these advantages effectively and therefore strengthen our position in the international market.