On April 9, 2013 business-breakfast “Financing for the Agriculture Sector” was held by Arzinger Law Office together with Credit Agricole Bank PJSC. This event was attended by representatives of leading international and Ukrainian agricultural companies.

The reports were held by: Oleksander Plotnikov, Counsel at Arzinger, Galyna Polishchuk, Direct Sales Department Head at Credit Agricole Bank PJSC, and Sergiy Didenko, Commercial Department Head at Credit Agricole Bank PJSC.

At the beginning, Galyna Polishchuk and Sergiy Didenko spoke about financing for the agricultural sector in Ukraine provided by Credit Agricole Bank. In particular, the bank supports agricultural producers on all stages of the production cycle, including: seasonal working capital financing, guarantees and promissory notes, trade finance in connection with sale of harvested crop, financing for acquisition of agricultural equipment, financing for agricultural producers against contracts with big processors and different programs.

Report held by Oleksander Plotnikov consisted of three major blocks:   

• trade finance as alternative to traditional lending;
• international financial organizations: real possibilities or a path only for chosen ones?
• Cedula de Produto Rural (farm product bond/agricultural product certificate).

Trade finance offers such instruments as: bank credit, bank guarantee (including return of advance guarantee), commercial letter of credit, standby letter of credit (SBLC), export credit guarantee (ECA), export credit loan, factoring and documentary remittance. At this, the lawyer noted that advantages of the trade finance include: long term resources (up to 14 years); cheaper than traditional bank credits; minimization of risks of non-fulfilment of obligations by contract parties; creation of a positive credit record. At this, trade finance provides for different lending possibilities for importers and exporters.

The second part of Oleksander’s report covered international financial institutions working in Ukraine, among which: International Finance Corporation (IFC), European Bank for Reconstruction and Development (EBRD), European Investment Bank, Black Sea Trade and Development Bank. Thus, he spoke in detail about their activity in Ukraine, services and project requirements. 

The audience followed with great interest the last issue of Oleksander’s report concerning farm product bonds (CPR). CPR is a title document confirming debtor’s unconditional obligation secured by pledge to supply agricultural products or to pay money under terms set therein. Oleksander spoke about two main CPR types (commodity and financial), their advantages, content and issuance requirements. 

During the event guests had a possibility to ask speakers their questions, to give comments and to share their experience and opinion with colleagues.