Ukraine becomes the 178th state to be admitted to IFAD

ALBERTO TRILLO BARCA, IFAD

ROME: Ukraine became the 178th country to be admitted to the International Fund for Agricultural Development (IFAD) on Wednesday, February 15th. Ukraine's application for membership has been accepted by IFAD's Board of Governors, the Fund's main decision-making body. IFAD began considering Ukraine's admission in 2016. The Governing Council's approval is one of the last critical steps in the process.

Its status as a Member State will not take effect until the instrument of accession has been deposited with the Secretary-General of the United Nations.

"We are very pleased to soon welcome Ukraine, the newest state to be admitted to IFAD. Ukraine's membership is in line with IFAD's mission, which is to empower all rural people, especially small rural producers, for their development and to ensure their inclusion,” said Alvaro Lario, President of IFAD.

"A founding member of the UN, Ukraine is recognized as one of the guarantors of global food security and one of the main agricultural producers in the world which can make an important contribution as a Member of IFAD," declared Yaroslav Melnyk, Ambassador of Ukraine to Italy.

"Despite the war, Ukraine is still determined to make its contribution to global food security, defuse the food crisis and save millions of people from hunger," he added.

Since the start of the war almost a year ago, the agricultural sector of Ukraine, one of the world's leading producers and exporters of wheat, corn and sunflower oil, is estimated to have suffered estimated damage to approximately 2.2 billion USD. The consequences of war have shaken food systems and supply chains around the world. Food prices peaked in March 2022 and then remained particularly high compared to previous years. High fuel and fertilizer costs in 2022 have affected agricultural production. Rising prices have forced many small-scale agricultural producers, with limited financial resources, to choose between buying food and cultivating their land.

Small producers in poor countries are among the populations most affected by the consequences of the pandemic, global inflation and the intensification of climate change and other shocks.

"IFAD was created to invest in rural people, to work alongside them, to give them the means to develop, to allow them to speak out. Over the decades, we have understood what works and what does not," said Alvaro Lario. "We have evidence that our people-centred approach to development works even in isolated, marginal and highly fragile contexts," he added.

Smallholder farmers in Ukraine

Although almost all of Ukraine's agricultural exports are supplied by large producers, four million smallholders have played a fundamental role in feeding the country, especially since the start of the war. They produce up to 80 percent of dairy products and fruits and vegetables, thus ensuring the country's food security.

Support for small Ukrainian producers is also essential for internally displaced people, many of whom have moved from urban to rural areas to escape the fighting. By selling their products in local markets, these smallholders contribute to local supply chains and build the resilience of rural communities.

It is very likely small producers in the western provinces of Ukraine, where the population has increased considerably due to the war, will need support to meet the increased demand for food.

According to a recent FAO report, many rural populations are at risk of falling into poverty, with 44 percent of them living on incomes below the subsistence minimum and 7 percent suffering from malnutrition. Ukraine's agri-food sector is a vital source of income for the approximately 13 million Ukrainians living in rural areas.

Ukraine will be fully integrated into IFAD's next funding cycle, starting in 2025. In the meantime, IFAD will explore ways to mobilize funds to support Ukraine's rural development priorities, including condition of rural infrastructure, activities that contribute to increasing agricultural productivity, improving competitiveness and creating jobs.

Ukraine is one of the founding members of the UN and has held numerous functions, including that of a non-permanent member of the United Nations Security Council (2016-2017). The admission of Ukraine to FIDA is a continuation of its membership in other United Nations organizations in charge of food issues, and having their headquarters in Rome, FAO and PAM.