The war bled Ukrainian agriculture dry.
But the war could be a force for the revival of this industry of the economy.
However, in Ukraine there is no force interested in this.

Labor shortage

Labour shortage is becoming a big problem in Ukrainian agriculture. By the end of 2023, 10 per cent of agricultural enterprises indicated a lack of labour as the main factor hindering business development. This was the highest value since 2013. The value of this indicator has consistently increased throughout the past year.¹ This allows us to call the conscription of men into the Ukrainian army one of the reasons for the increasing labour shortage.

Many village residents joined the army or had already died in the war. Therefore, in rural areas there is work, but there are no people who can work. This problem intensified when agriculture began to recover after the first shock due to the outbreak of the war. During 2023, the number of vacant positions in agriculture increased by 24.8 per cent, but the number of applicants decreased by 15 per cent. There is a particularly serious shortage of combine operators, machine operators, and tractor operators.² There is also a shortage of agronomists, veterinarians, mechanics, electricians and seasonal workers.³

The power of war against war

The war created a problem. But war can solve this problem. Due to the fighting in Ukraine, there are 4.8 million internally displaced people. Of these, 1.1 million have changed residence more than once.⁴ These people could become a force reviving Ukrainian agriculture. However, there are no government programs that attract internal migrants to rural areas. And this is a big mistake. Since the village is the most accessible place to live. And this, in the context of a state budget deficit, is a decisive factor in providing support to citizens.

With a little help from the government, hardworking migrants could not only move to the countryside but even become homeowners there. And owning their own housing greatly strengthens the connection between the migrants and their new place of residence. People would focus on working on their own land plots or nearby farms. If there is mobile Internet in the village, then remote work is also possible. This would be the beginning of the revival of Ukrainian agriculture. To activate this process in remote villages, only a few thousand dollars per family will be required.

The starting cost of a house in rural Ukraine is only US$500. For example, for this money people can buy a house in the village of Mokra Kaligirka, Cherkasy region.

“The area of the house is 538 sq. ft. Number of rooms: 3. Two living rooms and a veranda. Land area is 0.37 acres. The house needs to be renovated. There are many fruit trees in the garden. There is a barn. The house has stove heating,” it is written in the ad.⁵

For comparison, the starting price of apartments in Ukraine is US$1,200. But in terms of comfort, such an apartment is comparable to the cheapest house. That is, there is no water, central sewerage or gas. But the apartment will be slightly smaller in size and the apartment is sold without a land plot. For example, for this money people can buy an apartment in the village of Taranovka, Kharkov region. This apartment measures 452 square feet. The apartment needs to be renovated.⁶

As we see, the basic human value of housing is much cheaper in rural areas than in the city. A house with land is a more profitable purchase than an apartment for people who do not have housing or work. Many migrants would go to the countryside and buy inexpensive houses there instead of renting apartments in cities with no hope of being able to buy this housing. But alas, the state does not facilitate this.

What was it like before?

Let’s be honest. Before the war the situation was the same. The Ukrainian government paid for only one program to stimulate life in rural areas. This program supports construction in the village “Own Home”. It has existed since 1997, and since 2010 it has been financed from a special fund of the state budget through the return previously received loans, as well as local budget funds.

Thanks to this program, a village resident can take out a soft loan for housing. Funds can be spent on construction, completion, purchase or engineering support of housing. Money is provided for a period of up to 20 years. And for young families in which the age of the husband and wife does not exceed 35 years, the loan is provided for 30 years. The interest rate is 3 per cent per annum.

Maximum loan amount: up to US$14,600* (400 thousand UAH) – for new construction, up to US$11,000 (300 thousand UAH) – for the purchase of housing, up to US$9,100 (250 thousand UAH) – for reconstruction, completion of unfinished construction, up to US$3,600 (100 thousand UAH) – for the construction of utility networks, connecting them to existing communications. In 2020, 1,388 families received loans under the program, and in 2021, another 1,126 families.⁷ For a country with a population of almost 41 million people,⁸ this is a small number of families. The problem is the lack of funding and the difficulty obtaining these loans.

In addition to the state program, in some regions before the war there were small programs funded by charitable organisations. For example, in Ivano-Frankivsk region, settlers are provided with a long-term lease of a house, a plot of land and tools on the basis of a tripartite agreement. The agreement is concluded by a charitable organisation, local authorities and displaced persons. To receive everything necessary into property, a migrant must live and work in a new place for at least five years.⁹ The outcome of this program is unknown.

As we see, the problem of labour shortage in agriculture is not only the war, but also the lack of interest on the part of the Ukrainian government in the revival of the Ukrainian village. Now the low professionalism of officials is costly for Ukrainian farmers, who for some reason cannot influence officials. It is obvious that Ukrainian society is not able to get out of the impasse on its own. In this case, external assistance can help. Most likely, such assistance can be provided by the United States. It is the most influential country in the world and Ukraine’s main ally.

Australian Rural & Regional News surveyed American political scientists.

This is what experts answered to the question: Can the US government, as part of its support for Ukraine, improve the professional level of Ukrainian officials?

“Yes, the U.S. can support Ukraine by providing consulting services, advisers, and lawyers to assist with drafting laws. Additionally, the U.S. could offer training programs to help Ukrainian officials improve their skills”,
– Policy and Law Strategist, Sabrina Newby.

“This is their (Ukraine’s) war, and they should prosecute it as they see fit (the same can be said about Israel’s war against the Hamas terror gang).  We are allies, we can and must support their efforts to ensure their freedom and roll back the Russian invasion.  But aid should not be unconditional.  From a practical political perspective, US officials should be working to ensure US tax dollars are used effectively.  If that means providing training and oversight, then it’s not only the best way to ensure appropriate use of US aid, but  also ensures ongoing support from the US public”,
– Founder and President of TABcommunications, inc., Tab Berg.

“Yes they “could” but will they?  I doubt it, and I am ok with this. I’m of the opinion that the money the US is sending Ukraine is excessive and it has no certain guardrails on what and how the Ukrainian government is using US aid money.

 It’s my understanding the money is not only spent to defend against Russia, rather a good portion is finding its way into government officials’ pockets. Money should never be given to any country without direction and expectation of spend. So there is that. Not good.

However, I am also of the opinion that it is not the job of the US government to interfere with, or attempt to improve the professional level of the Ukrainian government. That is the job of the Ukrainian government and the people of Ukraine to police and clean itself up and be more professional.

So yes, the US government could try to improve the professional level of Ukraine officials but I doubt they will, for it isn’t their place to do so. Ukraine needs to govern itself as it sees fit”,
– Co-Founder, Managing Partner i5 Enterprises llc, Mike Iverson.

As we can see, help is possible. However, even allied relationships require trust and accountability. And Ukraine is already perceived ambiguously even in the United States. The ability to inspire trust is becoming the most important task of the Ukrainian government. And the revival of agriculture is a topic for an uncertain future….

* At the rate of the National Bank of Ukraine as of December 21, 2021¹⁰

References

1. https://kurkul.com/news/35250-fermeri-dilyat-traktoristiv-mij-soboyu-problema-nestachi-kadriv-zagostryuyetsya
2. https://delo.ua/ru/agro/stavka-na-molodez-motivaciyu-i-professionalnoe-razvitie-kak-selskoxozyaistvennye-predpriyatiya-spravlyayutsya-s-problemoi-deficita-kadrov-430152/
3. https://segodnya.novyny.live/ru/ukrayinski-sela-zalishilisia-bez-kvalifikovanikh-robitnikiv-cherez-mobilizatsiiu-156187.html
4. https://hvylya.net/uk/news/270440-stalo-izvestno-kolichestvo-vnutrennih-pereselencev-v-ukraine
5. https://www.olx.ua/d/uk/obyavlenie/termnovo-prodayu-zemlyu-v-sel-mokra-kaligrka-IDR8Hy8.html
6. https://www.olx.ua/d/uk/obyavlenie/prodam-vozle-s-taranovka-1-no-komn-kvartiru-IDRR3wG.html
7. https://naglyad.org/ru/2022/02/18/sobstvennyj-dom-v-sele-kak-gosudarstvo-pooshhryaet-stroitsya-vne-goroda/
8. https://www.rbc.ua/ukr/news/mvf-otsiniv-kilkist-naselennya-ukrayini-ta-1713333704.html
9. https://slovo.odessa.ua/ru/novosti/2019-selskoe-hozyaystvo-ukrainy-spasut-pereselency.html
10. https://index.minfin.com.ua/exchange/archive/2021-12-21/