Uman NUH | today: 01/24/2023

Ways to optimize the state support of agricultural commodity producers

Author(s) Nepochatenko Olena O., Doctor of Economics, Professor, Rector of Uman National University of Horticulture, Head of Department, Uman National University of Horticulture
Bechko P.K., Candidate of Economics, , Uman National University of Horticulture, Ukraine
Barabash L.V., , , Uman National University of Horticulture, Ukraine
Category Economics
year 2018 issue Issue № 92. Part 2
pages 18-32 index UDK 338.43.02+338.434
Abstract The importance of the agrarian sector of the economy for the state in modern conditions is comprehensively increasing. This is explained by the fact that the agricultural production is not only the basis of the country’s food security but also a significant source of welfare of the population, as well as the political stability. That is why, taking into account the above advantages, the state support of the agrarian sector of the economy is very important at this stage of the Ukrainian development. The issue of the state support for agriculture and commodity production was not accidental. Foreign countries pay a special attention to the support of agricultural producers. In particular, in 2013-2015, the average level of such support in OECD countries is fixed at 1.5% of GDP, in China – 2.8% and in Indonesia – 3.7%. In Ukraine, this indicator was 2.1%. Longer-term trends are similar: in 2005-2015, support to agricultural producers in OECD countries decreased from 28.4% of gross revenues to 18.7% and in Ukraine it is from 10.5% to -7.1%. Thus, we observe critical exponents which in no way contribute to the development of a national agricultural commodity producer. Due to the mentioned situation, in 2012-2015, there is a reduction in the growth rate of agricultural products in constant prices in 2010 by 0.3%, as well as the share of these products in GDP by 3.3%. State support is part of the mechanism of state regulation which can be implemented through both economic and administrative legal methods. Economic methods are implemented both directly and indirectly and among the means of implementation there are budgetary financing, increasing the availability of credit, improving the taxation system and tariff policy, risk insurance. It is these financial spheres that should become a priority when improving the mechanism of state support for agrarian commodity producers in Ukraine at the present stage. Indeed, through the introduction of preferential taxation regimes and simplified credit mechanisms, agricultural enterprises of all sizes and forms of ownership will be able to save the means necessary for enhanced reproduction and active operations and targeted budgetary support will contribute to the revival and development of agrarian industries which are now in decline.
Key words agrarian commodity production, state support, crediting, taxation, public financing.
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