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Agriculturel subsidies

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					                 AGRICULTURAL
                 SUBSIDIES
Meltem KARAGOZ
Mehmet Onur BINGOL
Sukru Ferat KORKMAZ
INTRODUCTION
Agricultural Subsidies on comparative Turkey-EU relations
divided into six parts.
These topics are:
-Historical Background
-Common Agricultural Policy
-Agricultural Subsidies
-Comparison of some of the EU member states and Turkey
-Turkey’s Current Situation According to acquis
communautaire
-Conclusion
HISTORICAL BACKGROUND
 Turkey applied for membership in the European Communities in
  11 July 1959.
 Ankara (Association) Agreement signed on 12 September 1963.
 Another development is additional protocol.
 The country was accepted as candidate to the European Union
  (EU) membership in 1999.
 On the specific chapter of agriculture; negotiations had started
  but the issue of agriculture and rural development is very hard to
  adopt.
 The screening started on 5 December 2005 and screening was
  completed on 26 January 2006 but this chapter had frozen at that
  year.
COMMON AGRICULTURAL POLICY
 Before the Single European Act, all European countries
  managed their agricultural markets with complex devices.So
  a common market for agriculture needed.
 Firstly financial support was established and the European
  Council agreed in 1998.
 So The Common Agricultural Policy (CAP) is a system
  which includes European Union agricultural subsidies and
  programmes.
 The CAP has a history of successful change which was very
  successful in meeting its objective of moving the EU
  towards self-sufficiency from the 1980s onwards.
             THE CAP OF TODAY
 The CAP had been reformed. The policy of the CAP is
  more different than past today and it was evolved than
  when it was created by the Treaty of Rome (1957).
 Many important changes to the CAP were already made in
  the 1980s but, above all at the beginning of the 1990s.
 Critics argue that too few Europeans benefit. Only 5.4% of
  EU's population works on farms, and the farming sector is
  responsible for 1.6% of the GDP of the EU(2005).
 The European Commission is discussing new reform of the
  CAP now which includes the next financial perspectives
  packages for 2014.
THE RELATIONSHİP BETWEEN TURKEY
AND THE CAP
 Turkey often engaged in very low value added forms of
  agriculture .
 The Agriculture Reform Implantation Project (ARIP) of
  2001-2005 represents a new direction in agricultural policy
  and aims to bring Turkey more in line with the EU.
 The 2007-2008 world food price crisis has renewed calls
  for farm subsidies to be removed in light of evidence that
  had bad effect for the relationship between Turkey and
  CAP.
 Finally Turkey should take some measures for accommodate
  their policy to the CAP.
 AGRICULTURAL SUBSIDIES
 An agricultural subsidy is a governmental subsidy paid to
  farmers and agribusinesses to supplement their income,
  manage the supply of agricultural commodities, and influence
  the cost and supply of such commodities. Examples of such
  commodities include wheat, feed grains (grain used as fodder,
  such as maize or corn, sorghum, barley, and oats), cotton, milk,
  rice, peanuts, sugar, tobacco, and oil see.
 European Union countries can be benefited from these
  subsidies.
 For rural development and inadequate agricultural regions.
 To avoid unequal level of development .
 And to recover the weakened agricultural sectors.
AGRICULTURAL SUBSIDIES
 Also, the agricultural expenditures can be generally
  financed by two funds.



 European Agricultural Guarantee Fund (EAGF)



 European Agricultural Fund for Rural Development
  (EAFRD)
                        EAGF
 Direct payments to the farmers


 Therefore, can regulate the agricultural market


 In such ways;


 Intervention, and


 Export refunds
                     EAFRD

Finances the rural development programmes
For all Member States
 Besides these institutions which are counted
 above,
Maybe the most important one is Integrated
 Administration
and Control System (IACS).
                          IACS

 Covering all direct payments to the farmers
 Such as;
 Single Payment Scheme (SPS)
 And applies to a large extent to the new MS
 With having single area payment scheme (SAPS)
 Which are based on;
 Number of hectares or animals
 Held by the farmer.
COMPARISON OF SOME OF THE EU
MEMBER STATES AND TURKEY
 In this part, our focus point is the examining some of the
major European Countries in the case of agricultural subsidies
such as France, Italy,Spain and Turkey.
  France has been one of the most dominant agricultural
centers of Europe for centuries.
 With about 730,000 farms, approximately 7 percent of the
   workforce is employed in agriculture or similar sectors such
   as fishing or forestry.
 In 2008 France received €9,940 Million in EU farm
   subsidies or approximately €18,862 per farm.
DISTRIBUTION OF FRANCE’S SUBSIDIES
                         FRANCE
 In that context, France is the most significant country within
  the borders of EU.

 France has an efficient agricultural sector.


 France, can make more contribution to CAP


 In exchange of that, their agricultural sectors can receive
  and benefited from agricultural subsidies.
AGRICULTURAL SUBSIDIES IN ITALY
 The CAP was not very successful in Italy in its initial stages because
  subsidies did not cover several traditional Mediterranean products.
 The agricultural sector employed only 5.5 percent of the working
  population in 1999 and contributed only 2.5 percent of the GDP in
  2000, with an output of over US$36 billion.
 This EU policy ensures that subsidies and incentives are offered in
  order to sustain prices and guarantee a certain level of income to
  farmers.
 In addition, Italian agriculture is suffering from changes in the climate
  and very poor management of the land.
 With only 5 percent of the land under cultivation, Italy is not self-
  sufficient in agricultural products, yet it enjoys an abundance of
  agricultural resources.
AGRICULTURAL SUBSIDIES IN SPAIN
 Spanish agriculture has traditionally been most affected by
  the level of rainfall, since drought is always a threat.
 In 1999 a EU reform of the Common Agricultural Policy
  was approved as part of the «Agenda2000» in Spain.
 The abundance of Spain's agricultural resources guarantees
  overall growth.
 As of 2005 France is also a net contributor and the more
  agriculture-focused Spain, Greece and Portugal are the
  biggest beneficiaries.
 Spain took € 4242 Million agricultural overall subsidies in
  1995, € 4895 Million in 2000 and € 6493 million in 2005
In Turkey,
 Support for agriculture and rural areas can be made in different ways;
 Agricultural investment incentives,aid in the area of foreign trade and
  protection for importation,
 Incentive premium for milk,
 Restrictions and support payments for plantations,
 Soil improvement operations,
 Price supports for cooperatives, and
 Also agricultural organizations.
Direct Income Support System
With this system;


Farmers, who have 1-199 dunam land,


Can receive monetary assistance,


In the form of donation
IN OECD COUNTRIES;

Farmers receive monetary support in the level of 36
dolar ( per land measurement of a thousand square
meters ).

In Turkey, prescribed support to farmers in the level
 of 5 dollars with Direct Income Support System.
ECONOMIC CRISIS AND ITS REFLECTIONS

 Most recently, despite the continued impacts of the global
  economic crisis, EU continue to distribute the agricultural
  subsidies in accordance with crucial needs to some
  countries such as Greece, the Netherlands and Denmark.
  For instance, EU officials doled out approximately $ 70
  million in the year of 2009. Moreover, since 2008, one of the
  biggest subsidies was $ 223 million which was given to the
  French sugar conglomerate “Teroes”, the aim was to aid the
  sugar industry. On account of the global economic crisis,
  this recovery was seen as a necessity (Times, 2010) .
CURRENT SITUATION ON RELATIONSHIP
BETWEEN TURKEY AND EUROPEAN UNION
ACCORDING TO ACQUIS COMMUNAUTAIRE
  Turkey's European Union’s acquis program was published on
   April 17, 2007.
  8 Sub-committee was established by EU-Turkey Association
   Council on 11 April 2000 for examine Turkey’s
   harmonization to acquis communautaire.
  In this context, Turkey create new structures for
   harmonization to acquis in some areas.
  Also define set criteria about 11 chapters , such as Free
   movement of goods, Customs Union, Competition Policy
   Agriculture and Rural Development.
FINALLY;
 In order to conclude this presentation, we again will
  mention the “Progress Report” and Turkey’s place in the
  Agricultural Policy.
 In this respect, “there are any development in the field of
  quality policy and there was some progress in the field of
  organic farming.
 The negotiations had started but the issue of agriculture
  and rural development is very hard to adopt.
 In conclusion, the alignment with the acquis remains limited.
  In addition to this, most administrative structures which are
  related to the CAP have not yet been established.

				
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