Single Economic Space countries to feed world in future

MINSK, 21 January (BelTA) – Countries of the Single Economic Space may become guarantors of the world food security in the future. The opinion of Mr Arkady Zlochevsky, President of the Russian Grain Union, has been laid down by the report SES+ Grain Policy of the Integration Research Center of the Eurasian Development Bank, the Bank’s press service told BelTA.

The report outlines approaches to shaping a coordinated policy for the development of the regional grain industry and presents several management innovations and proposals to increase the stability of the grain production and export growth. Experts of the Grain Processors and Bakers Union of Kazakhstan, the Economy and Forecast Institute of the National Academy of Sciences of Ukraine, and the Russian Grain Union have taken part in preparing the report.

The report indicates that in the last few years the Single Economic Space member states and Ukraine have acquired strong positions on the global grain market. In the previous five years Kazakhstan, Russia, and Ukraine averaged 36.3% of the global trade in barley, 21.5% in wheat, and 7.7% in corn. Yet the incomplete re-organization of the management system, lingering problems in grain transportation and trade as well as shortcomings of the agrarian policy prevent the countries from getting stronger on the global grain market.

“The grain industry boasts the highest investment potential and is one of the most promising industries for the economies of the Single Economic Space and Ukraine. If the grain industry is modernized, the three net exporters of the region can increase the nominal volume of the export as well as the share in the global trade. This is why coordinated measures to develop the grain industry become more important,” said Mr Igor Finogenov, Chairman of the Board of the Eurasian Development Bank.

An analysis of the situation has revealed the fact that the mutual dependence of the development of the grain industry of the leading CIS producers (Kazakhstan, Ukraine, Russia, and Belarus) and the global grain market has been rising since the early 2000s.

“At present our countries more and more confidently assert themselves on the global food market, primarily the grain market. The roadmap the report suggests is based on principles of competition and the use of natural agroclimatic advantages of our countries. It will create a good foundation for the steady growth of revenues of the agricultural producers of our countries. In 7-10 years the SES+ countries should become guarantors of the global food security,” underlined Arkady Zlochevsky.

The innovations the report suggests include the possibility of forming several grain clusters, which geographical location does not match national and administrative borders for the sake of growing rye, corn, export varieties of wheat and high-protein wheat.

Raising the domestic consumption of grain is one of the recommendations for the grain industry of SES+Ukraine. “With this in mind it is necessary to develop its deep processing for the sake of manufacturing supplementary feeds, which are constantly in shortage due to the development of animal husbandry and have to be imported from third countries. It is also necessary to develop the production of microbiologic synthesis products, including biopolymers. The steady growth of the global biopolymers market will also favor the growth of new exports,” reads the report.

All in all, the implementation of the SES+ grain policy is meant to increase the structural stability, the competitive ability and the institutional maturity of the grain industry of the Single Economic Space and the Commonwealth of Independent States. In turn, it will contribute to the social and economic development of the integration region, an increase in its food security and the expansion of its international trade, said the specialists.

The Eurasian Development Bank is an international financial organization instituted by Russia and Kazakhstan in January 2006 with a view to promoting the development of the market economies of the member states, their sustainable economic growth, and the expansion of mutual trade and economic ties. The Bank’s authorized capital exceeds $1.5 billion. The participating states of the Bank are Belarus, Armenia, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan.

Integration Research Center of the Eurasian Development Bank is a specialized agency set up by the Bank in 2011. The Center has been tasked with organizing research efforts, preparing reports and recommendations concerning problems of the regional economic integration.