Problems and Prospects for Development of Family Households in Ukraine

Abstract

The dual organizational structure of agriculture has developed in the agriculture of Ukraine, which manifests itself in the presence of two sectors—corporate (agricultural enterprises with the right of a legal entity) and individual (farms and households engaged in agricultural activities). In the total volume of gross agricultural production, the share of households in 2017 amounted to 43.6%. «De facto», most of them today are already family farms. Thus, 36.9% of Ukrainian households in land use exceeds 2 ha of agricultural land, including 16.5% of them have a land area of more than 10 ha, which is processed by the own forces of the household. But «de jure» they remain households, because they have no legal status as producers of agricultural products. Family farming is a leading form of agriculture both in developed countries and in developing countries. In the legislation of Ukraine, the status of a family-owned farm is defined in 2016 (the Law “On Amendments to the Law of Ukraine” On Farmers “on the promotion of the establishment and operation of family farms”). That is, according to the Ukrainian legislation, there are definitions of a farm and a family farm. The investigation provides a description and analyzes the agricultural activities of households in Ukraine. It proves a significant role of households in the production of agricultural products and a significant impact on the formation of its offer on the market. Legislative determination of the status of family farms is a significant achievement of Ukrainian agrarian policy. However, the effective functioning of family farms requires solving many more problems. The main of them, in our opinion, is the lack of experience in conducting family farming for a long period of time and financial incentives to create a family farm. For comparison, the shortcomings of modern family farms in the developed countries of Europe (Great Britain) and developing countries (Georgia) are presented. In order to accelerate the solution of the problems of family farms in Ukraine, it is expedient to create a Ukrainian Foundation for the Development of Family Farm and Villages with the participation of state authorities, the Association of Farmers and Private Landowners of Ukraine (AFPLU) and donor organizations; to approve the strategy for stimulating the creation and development of family farms for the period up to 2025, the concept of the relevant State Target Program, as well as the budget program “State support for the development of family farms”. When developing these documents, it is advisable to take advantage of the experience of foreign countries. The primary task of the state agrarian policy of Ukraine should be financial incentives for the voluntary acquisition of status of family farms by high-quality households.