Ukraine’s partners interested in pilot market for demining agricultural lands through ProZorro auctions

Ukraine has succeeded in launching the world's first pilot market for demining agricultural lands through ProZorro auctions, partners have shown interest in it, and now the task is to attract them to finance this market for its expansion and replacement of budget financing, said Deputy Minister of Economy Ihor Bezkaravayny.

"Now partners are interested, because they can understand with specificity that these resources were used through the ProZorro system and all went to the fields, we know the specific result of using this money," he said in an interview with the Interfax-Ukraine agency on the sidelines of the second annual Ukraine Mine Action Conference (UMAC-2024) held in Lausanne on October 17-18.

Bezkaravayny clarified that it is too early to talk about specific results of negotiations with partners on financing, since the program actually started working only a month and a half ago.

"Before that, we rewrote it three times, because this is a startup that we tried. And now it's just starting to breathe: we've held the first 20 tenders… So we're starting to show this algorithm to partners now, and they're interested in it. Because before, we didn't even have anything to show or explain how we wanted to implement it, so it was impossible to attract money for it," the deputy minister explained.

According to him, the state budget for 2025 includes UAH 1 billion for the program of compensation for demining agricultural lands, compared to UAH 3 billion in the 2024 state budget.

"It is extremely important for us to preserve the program, because the tool has started working, and we need to develop it further. However, the task remains to fill this tool with money not only from taxpayers, but also from partners," Bezkaravayny emphasized.

He noted that the project announced at the conference in Lausanne to determine priorities for humanitarian demining with the involvement of Palantir and funding from Switzerland and the United Kingdom will help develop the program.

According to him, currently the selection of sites for participation in the compensation program is taking place in a live queue format, 160 applications from farmers have already been submitted, and as each of these applications is verified by the State Tax Service and the Ministry of Defense for pollution – there are only four verification criteria – it becomes "green", it is prepared and put up for auction.

"But when there are not 150, but 150,000 such applications, this will be an opportunity for abuse. Before this stage, we need to build a system that will say what needs to be demined first, because this has the greatest impact on the economy, ecology, and social issues. When we have fewer resources than applications, we cannot cope without such a system," Bezkaravayny said.

He also confirmed the interest of Ukrainian agricultural holdings in the new market, but noted that they are not yet ready to finance demining services themselves.

"So far, everyone is looking closely, because this is really a startup that is taking its first steps. We need to understand how the cost appears," the deputy minister noted.

According to him, at present, there is a long-developed methodology adopted by the Ministry of Economy, and the first auctions have shown that it is quite efficient.

Bezkaravayny emphasized that the launch of the demining market is one of his KPIs.

"This means that there is demand, there is supply, there is a large number of mine action operators providing these services, and a large number of farmers who use these services," he explained.

The deputy minister concluded that the market is now actually starting up: there is demand from applicants, there is supply from operators.

"But so far 10 operators are competing, and 40 do not have the opportunity, because they do not yet have the opportunity to apply for a lot of 100 hectares. My task is to make sure that these operators have work. Not to give them money so that they buy equipment and machinery, hire people, but to give them work. And we are now thinking about how to attract donor resources so that these operators do something and they are paid for their work," Bezkaravayny noted.

He added that it is necessary to change the rules of the game and convince partners to give money not only to large, well-known operators in the world, such as HALO Trust, but to young Ukrainian companies.

"That's why we are negotiating, offering new tools, and new solutions. Some things are absolutely not for our partners, but some things are very interesting," he said.