The Ongoing Crisis in Ukraine: A Closer Look at Factory Farming

Since February 2022, Ukraine has been under a devastating full-scale military assault by Russian forces. Amidst this turmoil, the urgent need for food security has become increasingly apparent, leading to calls for collective action in the face of both human-made and natural calamities. In this precarious context, it may seem justifiable to funnel millions of Euros and U.S. dollars into a massive factory farming initiative that promises to nourish large segments of the population. But should we accept this at face value?

This is the very argument put forth by major development banks, including the European Bank for Reconstruction and Development (EBRD), the World Bank’s International Finance Corporation (IFC), and the U.S. International Development Finance Corporation (DFC). All three have invested in MHP, a prominent Ukrainian agribusiness conglomerate that operates the Vinnytsia Poultry Farm—the largest poultry farm in Europe, housing over 39 million chickens at any given moment, with its capacity steadily increasing. While this might seem beneficial for ensuring food security in a war-torn nation, a deeper analysis reveals troubling realities.

A Chain Reaction Leading to Significant Damages

The issues surrounding the MHP project can be traced back to the inadequate categorization of the initiative by its financiers, namely the EBRD and other public development banks. This has led to insufficient safeguards and a glaring lack of oversight for a mega-agribusiness endeavor. By failing to classify their investments in MHP as “high-risk,” these banks neglected to require the company to conduct or disclose essential baseline studies to assess the condition of the infrastructure and the environment before commencing operations. As a result, a facility that manages millions of animals, controls vast expanses of farmland, utilizes significant quantities of water, generates hundreds of thousands of tons of manure, and emits millions of tons of greenhouse gases annually lacks the capacity to evaluate its impacts on local water sources, roadways, and surrounding communities.

This oversight has led to dire consequences. Local water quality testing has uncovered alarmingly high levels of nitrates in local wells and elevated ammonia concentrations in the nearby Southern Buh River—issues typically associated with intensive poultry farming practices. These practices often involve extensive pesticide use, the storage of large manure quantities in open fields, and the reuse of cleaning water for irrigation, all of which contribute to environmental degradation. Residents have reported foul odors and dust pollution, alongside damage to roads and homes due to heavy vehicular traffic from MHP operations. While a bypass was constructed in 2018 to alleviate some of this damage, heavy trucks from the company’s supply chain continue to ravage local roads, further impacting community members.

Now, more than a decade after MHP began its operations in Vinnytsia, the burden of proof has been unjustly placed on the affected residents rather than the company itself. Even when local communities gather water samples and document structural damages, they face an uphill battle to prove that their health, housing, and safety rights have been compromised due to the factory farming activities. The absence of initial baseline studies only complicates their claims, rendering it nearly impossible for them to secure justice.

Undermining Genuine Development

Even more alarmingly, since MHP launched its poultry farm in Vinnytsia in 2010, community members have voiced serious concerns regarding the company’s approach to community engagement. Instead of facilitating meaningful dialogue about the potential negative repercussions of new operations, residents describe a company that resorts to transporting its employees to village council meetings, effectively packing the room, suppressing dissent, and ensuring a favorable vote for each expansion. Those who dare to oppose the project have faced intimidation and reprisals aimed at silencing any resistance. Such violations not only erode the possibility of genuine community input but also compromise the pursuit of authentic, sustainable development.

In response to these escalating issues—including water pollution, road and housing damage, air quality concerns, and flawed community consultation processes—multiple civil society organizations filed a complaint with the EBRD’s Independent Project Accountability Mechanism (IPAM). After nearly six years, IPAM’s Compliance Review Report is imminent and is expected to acknowledge several violations of the EBRD’s environmental and social policies. We implore the EBRD to embrace the findings of its accountability office, collaborate with its client to rectify the situation, and ensure that similar occurrences are prevented in the future.

No More Barriers

As the EBRD concluded its annual meeting last month, emphasizing support for Ukraine as a key priority, it is essential to reflect on the ramifications of investing in companies like MHP. The EBRD is currently reviewing its Social and Environmental Policy (ESP), a process that presents an opportunity to learn from past errors and establish mechanisms to remedy any future harms resulting from its projects.

A comprehensive revision of the ESP could significantly enhance the prospects for community members in Ukraine and elsewhere, ensuring they no longer face insurmountable hurdles in seeking justice. It is commendable that the draft ESP recognizes human rights as inherent to all individuals, providing a framework for policies and practices centered on people. Consequently, transparency and community participation must be integral components of these policies, aligning with the fundamental rights to freedom of expression and access to information.

This implies that projects should not only be accurately categorized, but the EBRD must also publicly disclose its methodology for categorization and facilitate community input. Moreover, the bank must acknowledge its responsibility to provide remedial measures if its clients fail to comply with its policies and ensure that no further harms are inflicted. In this regard, the EBRD must respect the findings of its internal complaint mechanism, IPAM, and enhance its assessment, monitoring, and handling of reprisals instead of relying on clients to self-regulate.

As the EBRD sets its agenda for the coming year, we urge the bank to seize this opportunity to reshape its policies with human and environmental rights as the foundation. They possess a moral obligation to do so, and accountability will ensure that their projects yield maximum positive impacts for communities.

Alexandre Andrade Sampaio is a Communities Associate, and Caitlin Daniel is an Attorney in the Global Communities program at the Accountability Counsel.
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