COVID-19: crisis or new opportunities time for the agricultural sector of Ukraine

Abstract

COVID-19 is a huge problem for the sustainability of the global economy, both short and long term. The spread of COVID-19 has led to a decline in business and economic activity, as well as a contraction in production - virtually all world economies have shown a sharp decline in GDP. World experience shows that agriculture is less vulnerable to a pandemic. In general, there is a calmer reaction to the demand for agricultural products than for industrial ones. The impact of agricultural production volume on the real GDP of Ukraine is investigated with a distributed-lag model on the data for the period 2008-2020. The effects of the impact distribute almost evenly between the four quarters of the year, which means that the lockdown effects in the agriculture sector will affect the GDP of Ukraine for a long period. The decline in production, the closure of markets and borders, the cancellation of orders led to the fact that the agricultural sector faced serious logistical problems. In addition, the economic downturn has affected farmers’ access to financial resources. However, COVID-19 also opened new opportunities for the Ukrainian agricultural sector: accelerating and expanding the process of digitalization, the opportunity to expand the market for export products, and increase skilled and unskilled labor. The authors propose six steps to ensure the sustainable development of the agriculture sector of Ukraine.