Yesterday the Cabinet of Ministers approved the decision to compensate
farmers for buying Ukrainian agricultural machinery and equipment by 15% of the
value.
The announcement is light on detail but it appears that
farmers who purchase Ukrainian machinery in 2017 will be compensated 15% of the
value if the 35% of their machinery is locally produced.
What is referred to in the announcement as the “localisation
level” which I take to mean how much locally produced equipment you own, will
rise to 45% in 2018, 55% in 2019 and 60% in 2020.
The Prime Minister said "We want to maximize equipment
produced from Ukrainian components” and “This will enable us to create
thousands of jobs in the sector and related sectors”.
I can already see a few holes in this policy, like the price of
locally produced machine rising by 15% and the shifting ownership of imported
machines between companies to hit the necessary “localisation level”.