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Newsnight Reports on Ukraine Land Investment

Recognised as one of the world's top news programmes and famed for having its finger on the pulse of global happenings, BBC Newsnight turned its attention on Monday to agricultural land investment in Ukraine.

Jeremy Cooke, a top journalist and specialist on agricultural issues, visited the vast farmlands of Ukraine to report on the huge changes currently taking place on Ukraine land, one of the world's most fertile but least exploited. In his report, Cooke highlights the contrast between some abandoned weed-ridden plains of Ukraine agricultural land - estimates claim that the size of Ukraine land not farmed since Soviet times is as big as England - and the huge wheat fields currently being harvested.

According to Cooke, the wheat harvest from Ukraine land is "going full tilt", an affirmation confirmed by the bird's-eye shots of combine harvesters running up and down acre after acre of crops. Cooke reports that the combines are busy 24-7, but "as fast as they can get the wheat out of the fields, it's being gobbled up by a ravenous international market."

Foreign investment interest in Ukraine land was ignited last year when soft commodity prices reached record highs. Investors including institutional funds are firmly convinced that "there will be big money in food production" and Ukraine with its immense plains currently lying empty or under weeds provides an excellent opportunity for land investment.

The relentless rise in global population (Newsnight quotes 2 billion more mouths to feed by 2030) and the world food shortage are also behind the combines on Ukraine land. Traditionally known as the ‘bread basket' of Europe, Ukraine land is now, according to Cooke, "offering new opportunity".

As reflected by Newsnight, land investment abroad is not without controversy. Accusations of ‘land grab' and ‘asset stripping by the West' are aired on the programme. However, it's difficult to class land investment in Ukraine as a ‘land grab' since the land is not owned by the foreign investors but leased. Leasing ensures the land remains the property of its original owners and also provides them with a regular and long-term income from land that would otherwise be under weeds and totally unproductive. Land is only rented from those owners who choose to lease. It is therefore difficult to class Ukraine land investment within the ‘land grab' category.

While the money behind the Obelisk's land investment opportunity in Ukraine is foreign, the operations are totally Ukraine-based. The leasehold company is Ukrainian as is the management company, Eurofarms. This ensures that employment opportunities are created by Ukrainians for Ukrainians.

Vasili Pryza, head of a Ukrainian farmers' union interviewed on Newsnight says, "we are looking for investors who will invest in things that are in our interest". There can be little doubt that leasing land to provide jobs and greater prosperity for local Ukrainians is "in their interest".

But perhaps the ultimate test of whether land investment is a ‘land grab' is to decide if foreign investment in the land improves the situation for the local community. And when you look at the benefits - land providing rental income for its owners and producing crops that are farmed and harvested by Ukrainians under the expertise of Ukrainians - the answer is obvious. And if then you take into account that mass grain production from Ukraine land can only help ease the world's acute food shortages, there really is no argument.

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