General information

The Project has two components:

  • Component 1: A credit line of EUR 400 Million to finance eligible sub-loan projects, and
  • Component 2: Technical Assistance supporting the disbursement of sub-loans through capacity building to banks and to potential final beneficiaries, that work within the value chains of cereals, oilseeds and the aquaculture/fisheries sector. In addition, the TA Project will support public infrastructure support projects which facilitate a better performance of the targeted value chains.

In 2014, Ukraine signed the Association Agreement with the European Union (EU), the commercial part of which included the creation and implementation of the Deep and Comprehensive Free Trade Area (DCFTA) with the EU in order to create new trade opportunities, boost foreign direct investments, economic modernisation and create new jobs.

The Association Agreement has been fundamentally changing the business environment in the country since. The DCFTA arrangement – consisting of a substantially preferential trade regime with the EU – foresees  the implementation of a wide range of reforms aimed not only to enhance trade relations between the EU and the signatory nations, but also to facilitate convergence to EU standards in various business-related regulations in the areas of food safety, technical standards, public procurement, competition policy, intellectual and property rights, etc.

At the same time, local businesses have been subject to growing competitive pressures across all economic sectors due to gradually increasing presence of foreign firms already fully compliant and comfortable with the EU regulations. Consequently, local firms need to extend their efforts towards more compliance with EU standards, while also require continued investments in cutting-edge production technologies in order to remain competitive.

The agri-food sector is of great significance for Ukraine, given its long tradition and competitive advantages. The sector is one of the largest in the country with an annual turnover of around EUR 16 billion and employs 15% of the total workforce. It is a key contributor to economic growth in rural regions, representing about 9% of Ukraine’s GDP. The majority of players in the sector are farmers, SMEs, Mid-Caps or cooperatives, which are largely underserved by the financial sector.

Against this background, the European Investment Bank (EIB, the EU Bank) has made available a line of credit of EUR 400m, along with donor-backed technical assistance, in order to support SMEs and Mid-Caps in the agri-food sector in Ukraine.

General organization

EIB’s “Ukraine Agri-Food Value Chain” Project is implemented by the Ministry of Finance of Ukraine with the support of the agent bank, which on-lends the funds to the participating financial intermediaries in order to finance the eligible investments by SMEs and Mid-Caps.

  • Project amount: EUR 400 million
  • Project Objective: supporting value chains in the agri-food sector of the Ukrainian economy, namely cereals, oilseeds as well as fishery and aquaculture
  • Borrower: Ukraine, represented by the Ministry of Finance of Ukraine
  • Borrower’s agent bank: JSC Ukreximbank

The EIB Loan:

The EIB loan is made available through Ukrainian financial intermediaries to support productive investments by SMEs and Mid-Caps, as well as public service providers, along the entire value chains. Local financial intermediaries are welcome to apply for the funds made available under the EIB project.

The cereals, oil seeds and aquaculture/fisheries value chains have been identified as best placed to satisfy domestic demand for quality produce, as well as to increase the competitiveness of the sector and its exports to the EU and global markets.

The programme could provide funding to the following activities:

  • primary production of grain and oilseeds;
  • expansion, upgrading and certification of drying, cleaning, sorting, testing and storage facilities for grain and oilseeds;
  • upgrading of aquaculture and fishery production facilities;
  • machinery and infrastructure for fish processing and canning;
  • testing stations, testing laboratories, research and professional training facilities;
  • agricultural knowledge outreach and certification offices;
  • fishery control and monitoring systems.

The EIB loan is further supported by the EU and the United Kingdom through technical assistance services.

Technical Assistance:

Based in Kyiv, the Technical Assistance Project Team – lead by the Denmark-based consulting firm NIRAS – works on two main levels:

  • providing support and advice to intermediary banks (including commercial banks and agricultural leasing companies) lending to SMEs and Mid-Caps in the cereals, oilseeds and fisheries sectors, and
  • directly to beneficiary SMEs on investment planning and credit applications.

The Technical Assistance Project Team is involved in the following activities:

  • Supporting the financial intermediaries in developing, monitoring and increasing of their sustainable credit portfolios, particularly in the selected value chains of agri-food sector;
  • Strengthening the institutional capacities of the financial intermediaries in the area of agriculture finance;
  • Enhancing the financial intermediaries’ capabilities to assess environmental and climate risks of agricultural investments;
  • Improving the financial literacy of the final beneficiaries acting in the aforementioned sector
  • Assisting the Project Implementation Unit (PIU) in monitoring activities and reporting to the EIB in order to ensure that sub-projects are implemented according to the EIB standards.
  • Advising on eligible investment projects and support the elaboration of sub-loan applications for financing
  • Assisting the Project Implementation Unit (PIU) in monitoring activities and reporting to the EIB in order to ensure that sub-projects are implemented according to the EIB standards.

Fund allocation scheme

Partner banks