National policies to support the mechanization and technical modernization of agriculture

in Kazakhstan, Russia and Ukraine

Eu.SerovaEu.SerovaD.PrikhodkoD.Prikhodko

FAO Investment CentreFAO Investment Centre

Annual Meeting 2010 Istanbul, 21-22 April

Lack of machinery?Lack of machinery? Types of governmental supportTypes of governmental support Domestic machinery manufacturing: Domestic machinery manufacturing:

challengeschallenges Cross country comparisonsCross country comparisons ConclusionsConclusions

Kazakhstan: Kazakhstan: inventories of selected ag. inventories of selected ag. machinerymachinery, , ths piecesths pieces

tractors

harvesters

reapersseaders

Russia: inventories of selected ag. Russia: inventories of selected ag. machinerymachinery, , ths piecesths pieces

Ukraine: inventories of selected ag. Ukraine: inventories of selected ag. machinerymachinery, , piecespieces

Kyrgyzstan: inventories of selected ag. Kyrgyzstan: inventories of selected ag. machinerymachinery, , ths piecesths pieces

Turkmenistan: inventories of selected Turkmenistan: inventories of selected ag. machineryag. machinery, , piecespieces

0

10000

20000

30000

40000

50000

60000

70000

1987 1991 1992 1993 2006 2007 2008 20090

500

1000

1500

2000

2500

3000

tractors, l.a.

grain harvesters

Russia: age of selected machinery Russia: age of selected machinery on large and medium farmson large and medium farms

Tractors

Grain harvesters

Russia: selected ag. machinery Russia: selected ag. machinery manufacturing, manufacturing, ths piecesths pieces

0

10

20

30

40

50

60

70

80

90

100

1990 1995 2000 2005

tractors

grain harvesters

Source: Rosstat

Ukraine: tractors manufacturing, Ukraine: tractors manufacturing, piecespieces

0

20000

40000

60000

80000

100000

1990 1995 2003 2004 2005 2008

Belarus: tractor manufacturing, Belarus: tractor manufacturing, ths piecesths pieces

New paradigm for technical New paradigm for technical servicesservices

Emerging of smallholder producersEmerging of smallholder producers Emerging of “agroholdings”Emerging of “agroholdings” Better use of machineryBetter use of machinery New technologies and machinery New technologies and machinery

generationgeneration

Policy tools: less market oriented Policy tools: less market oriented economieseconomies

State suppliesState supplies Double pricesDouble prices State and para-state machinery State and para-state machinery

servicesservices State tradeState trade

Policy tools: more market oriented Policy tools: more market oriented economieseconomies

State supported leasingState supported leasing Partial compensation for machinery Partial compensation for machinery

purchases costpurchases cost Soft lending for farms (mid-term)Soft lending for farms (mid-term) Support for credit coopsSupport for credit coops Machinery coops/services/poolsMachinery coops/services/pools Trade measuresTrade measures

Policy comparisonsPolicy comparisonsLe

asin

g, s

tart

ing

year

/sta

rtin

g ye

ar o

f cur

rent

pro

gram

me

auth

oriz

ed a

genc

y

budg

et e

ndow

men

t of

thi

s ag

ency

mon

opol

y po

wer

shar

e in

tot

al d

eliv

erie

s, %

fixed

list

of l

ease

d m

achi

nery

by

stat

e

limit

of s

ubsi

dy p

er o

ne fa

rm

term

s of

leas

ing,

yea

rs

inte

rest

, %

adva

nce

paym

ent,

% o

f tot

al

cost

insu

ranc

e m

onop

oly

Part

ial c

ompe

nsat

ion

of

mac

hine

ry p

urch

ases

cos

t

Priv

ilege

d le

ndin

g to

farm

sau

thor

ized

age

nt

endo

wm

ent

of t

his

agen

t w

ith

budg

etdi

ffere

nt a

ppro

ache

s fo

r co

rpor

ate

farm

s an

d sm

allh

olde

rste

rms

of m

ediu

m t

erm

loan

s,

year

s

Kaz 1995/2000 + + - + 7 4 15-25 - - 2001 - - + -Rus 1994/2000 + + + - 5-15 4 7-15 + - 2000 + + + 5-8-10

Ukr 1997/1999 + + + - 3-7 3 15-22 - 2000 2002 - - - various

40-5020-33

17-22

Policy resultsPolicy results

Ukraine

Russia

K a z a k h s t a n