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Development of Robust Land-use Decisions in Eastern Europe under Technology, Climate, and System Change: The Case of Ukraine

The states of Eastern Europe (Ukraine and all the adjacent European states Belarus, Hungary, Moldova, Poland, Romania, Slovakia) have experienced technology and system change in land use since the 1990s. Their total land area exceeds the land area of Mexico or Indonesia, their total gross domestic product (in current US dollars) is between those products of Mexico and Indonesia, and their total population is higher than population of the Russian Federation or Japan. Some Eastern European states are in the world top-five producers of corn, rye, oat, triticale, buckwheat, potato, carrot, turnip, apple, gooseberry, raspberry, blueberry, plum, currant, milk (sheep), honey, flax, and other agricultural goods. It is found the agricultural production value of Romania, Slovakia, and Ukraine has higher efficiency (in the terms of water and energy use) than that of Belarus, Moldova, Poland, and Hungary. Therefore, it was expected the regions of Ukraine bordering with Romania and Slovakia are of the highest agricultural productivity. This hypothesis is confirmed by the data of capital and labor use as well as the data of agricultural production value. At the lack of energy resources, in Ukraine water appears to be a critical agricultural production factor. Moreover, the regions of Ukraine experiencing a water deficit happened to be the most vulnerable ones substantiating the well-known hypothesis on growing role of water resources for sustainable development. Because a water demand depends on the weather conditions and climate changes, the robust land-use decisions are to be developed in order to contribute to the world food security. For instance, Ukraine is transforming from a global breadbasket to a global foodbasket attracting significant investments to food production and export. The strategic investments and operational land-use decisions are based on such modern systemic risk measures as (conditional) value-at-risk, robust variant of mean or maximum loss.