Turkey’s farms face reforms
With a 2007 deadline looming, the Turkish government is desperately trying to overhaul the agricultural sector in time to receive structural funds from the EU. By 2007, the EU candidate country is expected to have a system in place to disburse some 9-10 billion euros ($11.4-12.66 billion) to both farmers and state agencies involved in agriculture. Efforts to transform the sector, however, are likely to have far-reaching and potentially serious consequences for Turkey, as agriculture continues to account for around one-third of employment and is particularly important in often-impoverished rural areas with little else in the way of industry.
According to the most recently released figures from the Turkish Statistics Institute, 6.77 million workers, or 29.3% of the total Turkish workforce, were employed in the agricultural sector as of June 2006. Perhaps even more troubling, however, is the small size of Turkish farms, which limits productivity: 65% of farms are 0-5 hectares, while 94% are smaller than 20 hectares, making Turkish farms significantly smaller than those in EU member states. The smaller the plot of land, the harder it is to justify the expense of new equipment and technology, making modernization difficult.
Upsetting the applecart
Wages in the sector, however, are rising, albeit from a low base, with the average daily wages of a seasonal agricultural laborer increasing to YTL13.62 ($9.02) for women, up 14.26% year-on-year, and YTL18.06 ($11.96) for men, up 16.82%. Permanent workers in the sector have also seen a salary hike of late, with the average monthly wage now at YTL314.41 ($207.93) for women, up 9.89% year-on-year, and YTL403.49 ($266.74) for men, up 11.39%.
Government efforts to harmonize the local agricultural sector —a vital economic lifeline in many poorer areas of the country—in line with EU standards could upset the system, sparking a large increase in rural unemployment and forcing millions of farm laborers to head to cities in search of jobs. According to some independent estimates, the agricultural reforms could cut the industry by as much as 40%, leaving roughly 2.5 million people jobless.
The knock-on effect of reforming agriculture will likely be a wave of urban migration, straining employment, housing and social services in Turkey’s already-crowded urban centers. With a national unemployment rate of 8.8% as of June 2006, rising to 11.2% in urban areas, it is unclear where these largely unskilled and poorly-educated workers will find jobs.
As part of the reform effort, the government has taken aim at the overproduction of particular crops, especially hazelnuts, by introducing quotas. Turkey is the world’s largest producer of hazelnuts, accounting for some 70% of total production. With backing from the World Bank, the state has tried to reduce the area under hazelnut cultivation by 100,000 hectares through cash incentives, though the project has so far been less than a success: to date, only 885 hectares have been converted to other crops.
Far-reaching consequences
The government is also working to curtail the practice of farmers’ divvying up land among their children, which has resulted in ever-smaller plot sizes, limiting productivity and modernization. In order to raise the average size of Turkish farms, the government is now pushing farmers to consolidate fragmented family holdings, making it a requirement for EU funding. While this may spur consolidation, the government is also running a risk, as farmers who refuse to merge their holdings—likely the worst-off farmers most in need of funds—will be barred from receiving EU money.
Already, state subsidies on seeds, fertilizer and fuel are being cut, with total subsidies scheduled to fall from $6 billion to $2 billion a year. While these cuts will in theory be more than made up for by funds from Brussels, farmers will first have to qualify in order to receive EU money, a process which may create problems.
