Local economic development as a basis for the food security of municipalities: key points

Kyiv – On August 26, 2022, at the Ukraine Crisis Media Center, representatives of the Government of Ukraine, local authorities, and experts discussed the issue of local economic development as a basis for the food security of municipalities. The discussion was co-organized by the USAID HOVERLA Activity and the Ministry of Communities and Territories Development of Ukraine.

Local economic development can be the key to food security in times of war. Management decisions, adjustment of food growing and processing, and consolidating human, financial, and technical resources – allow working effectively in times of crisis. During the event, the participants discussed state and international grant programs, as well as mechanisms and tools for supporting local economic development in municipalities during the war.

“Support for the development of the state’s economy directly depends on the efficiency of activities at the fundamental level. Food security is a whole set of issues related to achieving this goal. That includes local economic development, jobs, business, and much more. Even a year ago, we talked about the fact that strategies for the local development of municipalities are one of the priority issues, but we focused more on land and budget resources, not always prioritizing economic issues. Now we are focusing the attention of local self-government bodies on development activities,” noted Viacheslav Nehoda, Deputy Minister of Communities and Territories Development of Ukraine.

“The farming season will soon come to an end, the heating season will soon start and preparing for the winter and ensuring that communities are able to positively impact food supply chains is very critical and extremely timely. But tied to that is revitalizing the agro-industries and restoring markets to create sustainable solutions. We are very proud to see how municipalities across Ukraine work hard on trying to ensure the security and well-being of their residents even in these difficult times. USAID HOVERLA Activity will continue supporting municipalities in these efforts,” emphasized Gabriel Abraham, Chief of Party of the USAID HOVERLA Activity.

“Today, the state provides opportunities to use grant programs for processing entrepreneurship, credit programs, and others. The budget of these programs vary widely: from one million to 60 million UAH depending on the goals and objectives of the programs. We believe that in the conditions of today’s crisis, the fall in GDP, and the contraction of the economy, state support is very relevant and will provide an impetus for the development of municipalities,” said Viacheslav Zubenko, Budgetary Relations Expert of the USAID HOVERLA Activity.

The list of 13 main state programs and their conditions can be found in the speaker’s presentation and in the infographic (in Ukrainian).

Tetiana Berezhna, Deputy Minister of Economy of Ukraine, presented several other opportunities for communities and entrepreneurs. All of them, according to Tetiana Berezhna, aim to ensure the creation of jobs and, as a result, stable revenues to local budgets:

“Balanced and regular payment of taxes to the budgets of all levels, in particular to local budgets, is a guarantee of economic stability during the war. The task of the Ministry of Economy in this area is to ensure all conditions for the creation of jobs in the field and the active payment of labor taxes. Our main goal is to create jobs, and the Ministry’s micro-grant program is one of the programs that actively provides this. Paying taxes should be easy, understandable, and, importantly, regular. In the matter of taxation, the main thing is to create a stable base. That work will bring income and taxes from labor in the field.”

The programs of the Ministry of Economy can be viewed in the presentation of Tetiana Berezhna (in Ukrainian).

To obtain additional funding opportunities, Ukrainians can use the State Agrarian Register – an automated electronic system available to all producers of agricultural products. Registered users will be able to submit online applications for participation in state and regional agricultural support programs.

“The State Agrarian Register is an online platform for direct state support programs. Anyone can register – they just need to have an electronic signature. It can be just a resident from the village, who runs a personal peasant farm – there are no restrictions. In less than 2 weeks of work, we already have more than 3,000 registrations in the State Agrarian Register,” noted Taras Vysotskyi, the First Deputy Minister of Agrarian Policy and Food of Ukraine.

Orzhytska municipality of Poltava Oblast is one of the two municipalities of the former district. According to the head of the municipality Olena Sydorenko, the main land resources and the budget-generating enterprise were subordinated to another municipality. Therefore, Orzhytska community began to work intensively on opportunities to increase its own budget.

“We worked with local revenue and taxes, raised land rents, and increased land taxes. We also focused on attracting tourists to the region of authentic nature and fishing. However, the war prevented the implementation of the project. Now we are working to support local entrepreneurs who are starting to take the first steps in business. We have our own family farms, milk processing, cheese production. We are starting to work on ensuring that enterprises have at least minimal subsidies from the municipality,” added Olena Sydorenko, the Head of Orzhytska municipality of Poltava region.

The following experts and representatives of the local authorities took part in the event: Ron Hunter, Senior Infrastructure Manager of the USAID ERA; Mariia Nikorych, the Head of Novoselytska community of Chernivtsi region; Viktor Hodyk, the Head of Horohivska community of Volyn region; Volodymyr Remeniak, the Head of Horodotska community of Lviv region.


USAID Governance and Local Accountability (HOVERLA) Activity intends to assist the Government of Ukraine to implement decentralization reforms by supporting local governance institutions to become more self-reliant, accountable to citizens, and able to effectively provide services.

This event is organized by Ukraine Crisis Media Center within the project “Communication support to Ukraine’s territorial communities for better coordination and outreach” that is made possible by the United States Agency for International Development (USAID) and the generous support of the American people through USAID HOVERLA Activity. The contents of this event do not necessarily reflect the views of USAID or the United States Government.