OREANDA-NEWS. February 14, 2013. Soon agrarians will have a chance to obtain loans at the rates by 10-15% lower than the current ones. It will become possible when Land bank starts operating in Ukraine. In first place a possibility to draw credits under lower interest rates will be profitable for farmer economies as well as for small and average enterprises of agro-industrial complex.

A decision on creation the State Land Bank was approved by the Verkhovna Rada last year. Ukrainian specialists had studied foreign experience first of all and held a series of meetings with representatives of world leading financial institutions. Notably, recently the Ukrainian party has had consultations with a group of leading European specialists in banking area who gave substantial recommendations and practical advice with regards to setting up the Land Bank in Ukraine.

Owing to the conducted legislative and organizational activity, the Land Bank has to commence operating within nearest time already. The financial institution will facilitate lowering load on the state budget which now deals with compensation of a part of interest rates. So, the state program on reduction of credit rates has been functioning in Ukraine for more than 10 years, however it does not solve the issue comprehensively.

“A lion’s share of the state funds goes to repayment of high interest rates which grow annually. On the one side, there are objective reasons which form these rates, but the state does not influence that. That’s why we have agreed to support an idea of creating Land Bank which would enable agrarians to receive interest rates under not more than 10% per annum,” noted director of financial and credit policy and accounting department of the Ministry of Agrarian Policy and Food of Ukraine Bagrat Ahidzhanov.

An expert in land relations and president of Land Union of Ukraine association Andriy Koshil considers that activity of the financial institution will become more effective if it concentrates on crediting certain agriculture branches.

“Agrocrediting is necessary and if the state involves, the current situation can change for better. Therefore, in order to make it really effective it is necessary to select priority directions of agricultural economy of the country, for instance, dairy cattle breeding. In addition, such loans should be rendered to farmers who are starting up and need financial support,” the specialist stressed.