Document

Economic Impact of EU Membership on Agriculture in Turkey
Hiroshi Kameyama*, Erol H. Cakmak**, and Yong Shou Lu*
*Faculty of Agriculture, Kagawa University
**Department of Economics, Middle East Technical University, Turkey
E-mail: [email protected]
SCENARIOS
Introduction
This study aims to evaluate the impact of EU
membership of Turkey on agriculture using a
regional agricultural sector model for Turkey.
Further liberalization of trade in agriculture is
expected to become top priority in Turkey. Apart
from bilateral trade agreements and ongoing WTO
negotiations, Turkey is also a candidate to join the
EU. The membership will imply full liberalization
of agricultural trade with one of the top traders in
the world, and also with her major trading partner.
The fiscal impact of the implemented
agricultural policies was one of the reasons which
eventually paved the way to a structural adjustment
program by the end of 1999.
BP
: Base Period, three years average of 1997-1999.
Out-EU : without membership in 2005
In-EU1 : with membership of EU
In-EU2 : with membership of EU and compensated payment
depend on negotiation.
Exogenous parameter value: the increment of population 1.5%, income
1.5% annually. Technical innovation, irrigation area increase 210,000 ha
(GAP 150,000 ha), exchange rate 1999 USD1=TL422.
Table 1 Deficiency Payment in Base Period
US $ per ton
1997
1998
1999
2000
Cotton
0
100
120
90
Question
Soybean
0
0
80
80
1)The magnitude and the distribution of the costs
and benefits of the past agricultural policies, and
the recent agricultural policy reforms.
Sun flower
Olive
0
0
0
80
50
0
60
56
2)The food (agricultural products) demandsupply model used in the impact assessment.
METHOD
This study is one common economic application
of nonlinear programming which involves price
endogenous nonlinear model of Agriculture in
Turkey for 50- commodities in 4 Turkey regions,
which is called Agricultural Sector Model (ASM)
as well.
As the second progress, Positive Mathematical
Programming (PMP) is incorporated to make
smooth calibration[2,3]. Calibration is performed
for activity level of crops acre and livestock.
DATA
State Static Bureau, State Planning Agency,
Directorate of Village Services, and FAO and
World bank data for cross checking.
Output of crops section includes i) yield,
ii) animal consumption, iii) byproduct (feeding
crops, forage, wheat straws, etc).
Input resources are land, labor hours, tractor
hours, fertilizers and seeds.
Land are classified into rain fed land, irrigated
land, forest land and meadows.
Results and Discussions
Producer surplus decrease and Consumer surplus increase.
Agricultural policy in Turkey has strong tendency as income
transfer for winning election.
So for farmers it has been the main unstable factors . It
takes time by harmonizing the policy instrument by
adjusting to EU framework.
Table 2 General Results of TASM-EU Scenarios
Million US dollar, %
BP
Out-EU
In-EU1
In-EU2
74,664
87,178
88,884
88,629
$. Producer Surplus
26,579
30,058
25,391
25,323
Consumer Surplus
48,085
57,120
63,493
63,306
Total
PS
CS
100
100
100
116
113
118
119
95
132
118
95
131
m.
%
To t a l S u r p l u s
References
[1] Erol H. Cakmak and Haluk Kasnakoglu (2002) Assessment of Agricultural
Policy , Report of the Par-Paa Project draft, Ankara.
[2] Howitt, E. Richard (1995) Positive mathematical programming. American
Journal of Agricultural Economics 2. 77:329-342.
[3] Torben Wiborg, Bruce A. McCarl, Svend Rasmussen, and Uwe A. Schneider
(2005) Aggregation and Calibration of Agricultural Sector Models Through Crop
Mix Restrictions and Marginal Profit Adjustments, Paper prepared for
presentation at the PMP, Extensions and Alternative Methods Organized Session
of the XIth EAAE Congress (European Association of Agricultural Economists).

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