European Journal of Management Issues (Jun 2024)
Problems of the Organic Agricultural Production Development as Threats to Ukraine's Economic Security
Abstract
Purpose: Currently, the country's economic security is under constant attack, and organic production development is restrained by both pre-war and new factors. Given the need to speed it up, identifying problems and finding mechanisms to solve them will contribute to achieving sustainable development goals and strengthening economic security. Design / Method / Approach: Based on the data of the Research Institute of Organic Agriculture (FiBL), Diia Business, OrganicInfo, and World Bank, we used economic and statistical methods: average, relative values of dynamics, structure, coordination, non-parametric criterion for assessing the tightness of the connection (Spearman's rank correlation coefficient) and graphically depicted the obtained results. Findings: The production of Ukrainian organic products is characterized by imbalance and weak diversification: in 2021, 96.85% of crop areas were devoted to the cultivation of grain and oil crops. In 2022, the volume of sales of organic products on the domestic market almost doubled (-48%). Organic products are not a priority for retail trade in Ukraine, which is the driving force of sales in European countries. The hypothesis about the non-randomness of the correlation between the consumption of organic products and GDP per capita was confirmed: with a probability of 99.9%, there is a direct and strong (0.87) correlation between the indicators. Theoretical Implications: The work identifies the problems of organic production development, possible ways to solve them, the mechanisms of its stimulation by the state based on European experience, and and strengthen economic security. Practical Implications: Calculations prove that the reorientation of the Ukrainian producer to the domestic consumer is not a solution to the problems associated with blocking the export of Ukrainian agricultural products until the level of GDP per capita is similar to European indicators. Originality / Value: Work on a topic that includes the development of a priority for the EU and promising for Ukraine's direction of the agricultural sector against the background of the ongoing Russian invasion. Research Limitations / Future Research: In further research, it is advisable to compare the development trends of Ukrainian organic production with European ones since this article focuses on internal problems. Paper type: Empirical JEL Classification: Q01, Q14, Q18
