Ukraine joined WTO

[Albatross]

Originally Posted by Max_the_Highlander

If Ukrainian agriculture has potential but it is in such bad shape (but charges such unrealistic prices), competition is the only way to kick it to the back.

That's a logical argument in theory, but doesn't hold in the current political reality in Ukraine. As you know better then i do, trading agricultural land is forbidden by law. As a result, farmers can't mortgage their land, which prevents banks from providing agri-loans. Therefore farmers don't have access to finance to improve their business. Under such conditions, farmers will be forced to compete with two hands tied behind their back.

You might be optimistic land reform will be succesfully implemented. Others might be less optimistic as it's already a political topic for a long time. Timing of land reform is a real issue as well. It must be dealt with before exposing farmers to international competition and not after.

[is5512]

I am no economics genius, and won't try to pretend otherwise, but Al-b, you made a comment that just scared the stuffing out of me. "As a result, farmers can't mortgage their land."

Is there really a difference between a totalitarian government stealing a farmer's land and a banker repossessing it? The latter may be the "western way," but it doesn't mean it's the right way.

There are some good men and women trying to build a strong Ukraine. Maybe they can discover a way to do it without selling Ukraine's soul to the devil...the eastern or the western one.
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This kept me up last night (that, or the midnite snack of garlic bread). What about treating farmland in two ways 1) as a means of subsistance; therefore guaranteed for the use of the "owner" and illegal to mortgage or repossess. Anything above the basic parcel could be treated as a business venture, taxable as such, and which the farmer could use to secure loans. Any thoughts, Smarter People?

[Albatross]

Yes, there is a big difference between mortgaging land and stealing it. It seems to me that in general you are unfamiliair with how banks operate and what their economic function is.

As the world population increases, so does the demand for food. In principle Ukraine is well positioned to benefit from this trend. But Ukraine's farmers need equipment, fuel, efficient land plots etc. Somebody has to pay for it. One way is via bank loans. There's nothing develish about that. Since banks only make a fixed interest margin, the need collateral to reduce their risk. Reposession is a last resort for a bank and it's the exception and not the rule.

In the current situation in Ukraine, farmers need to take out un-economical loans against their future harvest, or leave their business as it is. That's worse. A market for agricultural land would at least give them a choice.

[Albatross]

By the way is5512, welcome to the board! And how can we call you, 5512 is a bit impersonal.

[is5512]

"Unfamiliar with how banks operate" <grin> I'm more familiar with how people in debt operate. They never blame the bad decisions they make, or the risks they take. If something goes wrong, it's always someone else's fault, whether it's the evil government, greedy bankers or the (insert ethnic group here). The anger seeks a target; and right or wrong, institutions can fall because of it.

Under the circumstances, such a post should label me "Cleopatra, Queen of DeNial." Gender's wrong, so Yakiv or Yasha will do, my friend. And thanks for the welcome.