DONETSK, Aug. 20 -- Agricultural land reform is accelerating in Ukraine. The governor of southeastern Ukraine's Donetsk Province, Sergei Vasilevich Polyakov, announced today that the Donetsk Model for agricultural land privatization and farm reorganization, piloted last year, will be expanded in the region and introduced on up to fifteen collective farms.
The expansion of the Donetsk Model marks the second stage of land reform in Ukraine. A pilot program was initiated by the Ukrainian Government in 1995. Officials invited representatives from the International Finance Corporation to develop a legal mechanism to transfer ownership of land and assets held by collective agricultural enterprises to the people who live and work on the land. IFC' technical assistance work is funded by the British Know How Fund (KHF).
Governor Polyakov noted the positive results of the pilot stage of the project and stressed its advantages in addressing both economic and social issues in rural areas. "Our aim is to become a center of agricultural reform that can set an example for all of Ukraine," he said in the province's capital city Donetsk, the third largest in Ukraine. "The Donetsk model has demonstrated its effectiveness in the pilot phase and will be an important tool in strengthening and liberalizing our agricultural sector here and throughout the country."
Stephanie Miller, Project Manager at IFC commented, "we are proud to play a role in assisting the Donetsk Administration in their ambitious plans to intensify land reform." IFC's technical assistance work in land privatization in Ukraine is based on its successful experience in land reform in Russia, where, in 1992, a land privatization model was developed in Nizhny Novgorod.
The British Government's KHF representative and British Embassy official, Ms. Fionna Gibb, commended the pioneering efforts of the Donetsk Administration and the success of the pilot phase of the land reform project: "The British Government is pleased to continue its support for the Administration's important reform efforts. Their firm resolve to transform the agricultural sector sets an important example for the country." The KHF was established in 1989 to provide technical assistance to governments in Central and Eastern Europe. The aim of the Fund is to support the transition to democracy and a market economy by providing advice and expertise to countries in the region.
The Donetsk Model is based on three principles - free choice, transparency, and fairness. Donetsk was selected as the pilot region because of the strong political will expressed by the Province's administration and because the agricultural conditions are typical for Ukraine in general.
IFC's technical assistance work in Ukraine focuses on helping the government create a private sector. IFC is currently managing three other technical assistance projects in Ukraine p; small-scale privatization, post-privatization, and mass privatization. IFC's activities in Ukraine are funded by USAID, the KHF and the Japanese government. IFC is a member of the World Bank Group and is the largest multilateral source of equity and loan financing for private sector projects in developing countries.
