Ukraine mulls subsidization of small-scale farming

The Ukrainian Agriculture Ministry said Friday that it has proposed the government to consider establishing a subsidizing program for small agri-business as part of the country's agricultural reform.

"A direct support for small and medium-sized producers is one of the key priorities of the Agriculture Ministry in the framework of its reform strategy," said a statement posted on the government's website.

If the government agrees to provide the subsidies, the ministry could distribute about 120 million U.S. dollars next year among the farmers, who cultivate less than 500 hectares of land, the statement said.

The money will be raised from the fund, which accumulates the state's incomes from agriculture products sales, it said.

The access to financing remains one of the biggest challenges for small-scale farming in Ukraine as local banks provide lending only to large agriculture enterprises.

Currently, there are around 40,000 big farming households and about 4.2 million small farmers in the country.

According to the estimates of local experts, Ukraine relies on small farming for about half of its total agricultural output, which amounted to 9.5 billion dollars last year. Endit