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Donetsk, Ukraine, March 5 -- Ukraine will be one step closer to reclaiming its historical position as the "breadbasket of Europe" on March 6th when the members of Lenina collective agricultural enterprise in Donetsk Oblast assemble to transform their land and farm property into private farm enterprises. This will be the first time a working model is established for agricultural land reform in Ukraine. The Governor of Donetsk Oblast, Mr. Vladimir Shcherban, announced the this pilot initiative at a press conference in Donetsk today. Commenting on the program, the Governor stated, "Establishing a model for agricultural land reform in Donetsk Oblast is an important first step in ensuring the future productivity and efficiency of the agricultural sector throughout the country." Lenina farm is one of three collective agricultural enterprises in Donetsk Oblast participating in a land reform and reorganization program. The 1660 members of these farms have been working since October with the Oblast Government's Department of Agriculture and Land Resources Committee to create a model for farm reorganization. The pilot program of land reform and reorganization was initiated by the Government of Ukraine in 1995. Officials invited the International Finance Corporation (IFC), a multilateral organization focused on private sector development and a Member of the World Bank Group, to provide technical assistance at the Oblast level to develop a legal framework and methodology for collective farm reform. IFC's technical assistance work is made possible by financing from the British Know How Fund. Donetsk Oblast was selected for the pilot program because of its reform-minded leadership and because its collective farms with "black earth" are typical of farms in Ukraine in general. The Donetsk model for agricultural land privatization, like the Nizhny Novgorod model, is based on the principles of choice, transparency, and fairness. The objective of the model is to establish a legal framework for the transfer of ownership of former collective and state farms into the hands of the people who live and work on the land. This transfer of ownership is intended to create new entrepreneurs who will be free to manage their own agricultural enterprises while establishing a model that can be replicated throughout Ukraine. (More) IFC Press Release No. 96/85 Page 2 of 2 The members of the three pilot farms, Lenina, Ivanovskoye, Rossiya, each voted to participate in the pilot land reorganization. After this vote, the farms embarked on a process consisting of the following elements: Distribution of land and property entitlement certificates to individuals living on the farm. Farm members received an equal share of land while property entitlements were calculated on the farm members' tenure on the farm. Dissemination of information to educate farm members on how to use their entitlement certificates. The investing, trading, selling, giving, and bequeathing of entitlement certificates that give individuals and groups the ability to acquire sufficient purchasing power to participate in the distribution meeting. The division of the farm's land and property into lots using the existing operational subdivisions of the farm. The transfer of land and property through a distribution meeting (auction) where individuals and groups bid for farm lots and property using entitlement certificates. The transfer of ownership through the issuance of land and property deeds. Following the first distribution meeting at Lenina farm, subsequent distribution meetings will be held at Ivanovskoye on March 12 and Rossiya on March 14.
Contact:
Dmitro Konyk Viktor Kobylyanski Valerie Wright
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