Only Ukrainians will access farmland market at first, Zelensky says

Ukraine’s farmland market must be introduced gradually,
allowing only Ukrainians to make purchases in its first stage of operation,
President Zelensky told journalists during an Oct. 10 press marathon.
Zelensky’s position reiterates the policy of legislation already submitted to
parliament. “For a certain time, we should sell land only to Ukrainians. Only,”
he stressed. In a couple of years however, the opportunity to buy farmland
should be extended to foreign entities, he said. Yet those foreign companies
that are already renting and cultivating Ukrainian land should be dealt with
separately, Zelensky added. “You can’t say, ‘We won’t sell to you’ or ‘We
will sell your land to Ukrainians’,” he said.

Recall, Ukraine’s parliament published a draft law on farmland reform on Sept. 20,
stipulating the launch of farmland trade since Oct. 1, 2020 and allowing only
Ukrainian citizens and Ukraine-registered legal entities to own farmland.

Alexander Paraschiy: So far,
Zelensky is not contradicting the legislation under review, which stipulates
farmland can be sold to a company registered in Ukraine, even if it is owned by
non-residents. However, that clause could be potentially changed to limit
foreign-owned companies’ ability to trade Ukrainian farmland. In our view, any
limits would be inefficient as they will restrict price growth for farmland,
which in turn will prevent current land owners from realizing the full value
potential of their asset.

At the same time, it’s positive that even under the
possible restrictions, government is ready to account for the interests of
large internationally listed farming companies. We expect to hear more
information on design of land reform from the government or parliament in the
nearest future.