Farm reforms in Turkey should accelerate to improve competitiveness, OECD says

ANKARA (A.A) - 29.04.2011 - A report published by the Organization for Economic Cooperation and Development (OECD) on Friday and titled "Evaluation of Agricultural Policy Reforms in Turkey" said that "farm reforms in Turkey should accelerate to improve competitiveness.
The OECD report was made public in Ankara in a meeting attended by the Turkish Agriculture and Rural Affairs Minister Mehmet Mehdi Eker and Wilfrid Legg, head of the OECD's Agriculture Policies and Environment Division.
"While much has been done to integrate environmental concerns into agriculture, strengthen the legal framework, reform institutions and improve rural policy, Turkey's farm policies are still too protectionist, with high levels of support to farmers and heavy protection against imported foodstuffs," the OECD report said.
"Evaluation of Agricultural Policy Reforms in Turkey" says the country could boost competitiveness with renewed efforts to decouple farm support from production while continuing with institutional reforms.
These steps will also better prepare Turkey for possible future EU membership, the OECD said.
"Recent policy reforms have brought about important improvements, but the productivity and efficiency of the Turkish agricultural sector still remain low, due to small, fragmented farms, low education attainments and poor agro-ecological conditions" according to Wilfrid Legg, who presented the report with Mehdi Eker.
"Turkey should shift its output-based farm support policies toward measures that help farmers increase competitiveness, raise farm incomes and tackle environmental problems," Legg said.
Minister Eker welcomed the OECD analysis, noting that "the new report shows that Turkey has seen a constant increase in agricultural production in value terms, despite a decreasing agricultural population."
The OECD also shows that Turkey is a world leader in a number of crops, with high product diversity and strong exports - despite the small size and fragmentation of agricultural holdings - that contribute to food security at the global level, Eker said.
The OECD report recognizes the importance of the Turkish farm sector - the country's largest employer, representing 25% of the workforce, and a major contributor to GDP, representing 8% of economic activity - as well as its position in global markets. Turkey is the world's 7th largest agricultural producer, and a top producer and exporter of crops ranging from hazelnuts and chestnuts to apricots, cherries, figs, olives, tobacco and tea.
The OECD points out, however, that recent Turkish production gains have not been matched by productivity improvements. Nearly two-thirds of farms are less than 5 hectares, and competitiveness is hindered by strong dependence on price support to farmers.
New data shows that Turkish support to farmers has increased in recent years. At 34% of total farm income over the 2007-09 area, the country's Producer Support Estimate (PSE) now exceeds the OECD average, which is 22%.
While the EU has decoupled farm support from production, Turkish efforts to encourage a more competitive agriculture system have slowed: According to OECD Estimates, 88% of the support to producers continues to be provided in the form of market price support, which distorts production and trade and is, in addition, an inefficient way to transfer income to farmers.
To improve farm support while boosting competitiveness, the OECD says Turkey should move away from output-based policies toward measures that support R&D, skills training and advice to help improve productivity. It should also seek to facilitate off-farm activities as sources of farm household income and tackle environmental problems, in particular by strengthening water management policies.