Scientific Center of Innovative Researches, International Conference on Corporation Management-2020

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Oleksandr Volynets

Building: International Conference on Corporation Management
Room: on-line
Date: 2020-12-03 12:35 PM – 12:39 PM


The agrarian production, land resource exploitation, centralization of productive forces, food capacities, territories, growing and primary processing of agricultural raw stuff along with decentralization of regulation of development and functioning of agriculture and rural areas have changed the face of the Earth. Matters of the preservation and efficient use of land resources in agriculture named as agricultural natural resource management rationalization must be addressed on the basis of scientifically grounded farming systems (rationalization of the cropping structure, soil treatment methods, artificial irrigation, chemical and agro-biological melioration, differentiated fertilizer application, agromeliorative measures) with the supporting framework of the local self-government system and the processes arising therefrom as well as structuring the priorities in state and local finances.

Scientific foundations for agricultural natural resource management rationalization were laid way back by V. V. Dokuchaev [1]. The most ancient and survived, until recently, farming system was shifting farming characterized by constant movement of cultivated lands and population. The crop was grown on a plot cleared from natural vegetation, in several years, natural soil fertility and yields dropped, this plot was left, a new one was cleared and cultivated. With the population size and density moving higher, cultivated lands were moved on the limited area, stationary dwellings were built and a shifting system was transformed into a fallow system. This system distinguishes by higher intensity, considerable volumes of production of commercial crops. At the beginning of the 19th century, a fallow system was of the greatest importance in agriculture. Later on, the foundations are formed for a landscape farming system [2], aimed at searching opportunities for application of all morphological parts of the landscape.

Modern agriculture is characterized by a high mechanization level that has a positive impact on the productivity but a destructive impact on the state of the environment. Such setting of a problem had been denied for a long time, however, the Food and Agriculture Organization of the UN (FAO), within the framework of implementation of the Global [3] and National [4] Millennium Development Goals, managed to pay attention to the formation of stable ecological threats from existing agricultural practice, the absence of coordination between financial transformations and the formation of incentives for local authorities to rationalize agricultural natural resource management.

A chain of factors of degradation of the environment resulted from agricultural activity looks as follows:

the first one is loss of biodiversity (agriculture has become the major factor of loss of many varieties of plants and animals even in Germany, not to speak of less developed countries, in which losses of biodiversity turned to be even more considerable);

the second one is progressing eutrophication of underground and surface waters resulting from washing fertilizers from agricultural fields (for example, in Holland, agriculture is considered to be the major cause of acid rains);

the third one, deforestation – provides stagnation of accumulation of biological resources, biodiversity, provides with a source of genetic material for biotechnical products.

Developed countries intensively develop a direction relating to creation of new farming forms intended to minimize adverse effects on the environment subject to social-economic aspects. In literature, this direction became a name of “alternative agriculture” [5]. At the initial stage, the alternative agriculture system based on a wide use of organic fertilizers, crop rotation optimization, use of biological plant and animal protection means with concurrent minimization of using chemization means, nonrenewable energy resources and with wider application of nontraditional energy sources. Such direction has become known in literature under the name of “organic agriculture” [6].

At initial stages of development of the organic agriculture systems, the results were achieved in enhancing the ecological efficiency of agricultural products. But such systems, in general, are characterized by higher labor effort indicators and lower productivity indicators. At the same time, a comparative value analysis of alternative agriculture systems with traditional systems demonstrates the differences by individual crops. Such analysis was conducted in the USA and Western Europe in the 80s of the 20th century. And many results of the analysis speak in favor of alternative farming systems. So, for example, variable costs per grain ton in the alternative agriculture systems are twice as low as those in the traditional systems [7].

The crop yield is a fundamental indicator preventing from the wide spread of the alternative systems of agrarian production as well as from the formation of the support system (at the national or local level) for transition of agricultural goods producers to its new framework [8]. In this connection, the so called concepts of “dynamic equilibrium” or “sustainable agriculture” [9] have become popular. In the first turn, dynamic equilibrium agriculture must provide an ecological equilibrium of the environment with the concurrent rational use of material-technical resources and adaptability to variable instruments of regulation and budgetary stimulation under the fiscal decentralization conditions. Its basis must become a new financial policy of the state on its own agriculture, radical changes both in structure and parameters of state financial revenue regulation instruments, implementation of the financial mechanism oriented on financial recovery of agricultural enterprises, in general, and depressed areas, in particular.

Implementation of the above provisions is based on the following imperatives:

1) on the need for increasing in state protectionism as a determinant of increasing in financial stability of rural goods producers on the basis of rationalization of parameters and structure of subsidies as an element within the system of state regulatives ensuring, at the end, indicative return on and stability of the financing of agricultural natural resource management rationalization;

2) on the creation of the conditions enabling the priority use of loans from the banks (first of all, state banks) in the capital structural orientation as the most predictable counterparty proving real monetary capital and being in the orbit of state regulation and architectonics of the system of the financing of agricultural natural resource management rationalization;

3) on the strengthening of the role of local authorities as a key provider of local development goals of the industries of the agrarian sector of the economy, on the provision of the balance between the performance of agricultural goods producers and programmed ecological parameters of the specific location.


management; agriculture; development