How can we overcome vicious cycles in agriculture?

How can we overcome vicious cycles in agriculture?

Within the scope of BU+ Events, Open Course with Alumni: The States of Economy speech series was held on Thursday, February 21st, 2019, to discuss Turkey’s agricultural policy. Professor of Economics at Boğaziçi University, Prof. Dr. Gökhan Özertan’s presentation focusing on problems of Turkey's agricultural policy, the changes occurring in the world in agricultural sector and possible solutions for an efficient agricultural policy, met with great interest of graduates and academics.

Open Course with Alumni: The States of Economy speech series that was organized in order to evaluate current developments in the economy and bring the graduates together in the evening lectures, with support of Boğaziçi University Alumni Office. 4th of the speech series, "Turkey's Agricultural Policies: Why Can’t We Overcome the Vicious Cycle?” was held at Demir Demirgil Hall, in February 21^st.  Head of the Department of Economics at Boğaziçi University, Prof. Dr. Gökhan Özertan explained structural problems and possible solutions of the agricultural policies in Turkey.

In the opening speech of the event, Professor of the Department of Sociology at Boğaziçi University, Prof. Dr. Zafer Yenal informed the participants about Özertan's academic career as well as sharing the activities organized by Culture and Arts Commission of Boğaziçi University. After graduating from the Department of Economics at Boğaziçi University, in 1994, Gökhan Özertan completed his doctorate in 2001 at Texas A&M University in the field of agricultural economics. Özertan has been teaching microeconomics, statistics, econometrics, innovation economics and agricultural economics at Boğaziçi University since 2001. His research interests include modeling of agricultural and environmental processes, the use of technology in agriculture, the effects of climate change and commodity price movements.

“Problems in agricultural and food sectors affect other sectors as well.”

Özertan started his presentation by stating that structural problems in agricultural and food sectors are seen in and affect other sectors; “The agricultural and food sector has its own structural problems because there are many actors and stakeholders such as producers, intermediaries, industrial and food companies, input suppliers, public and technology companies.”. The fact that there are more actors in the agricultural sector makes it difficult to manage, Özertan emphasized. Also, since the producers are mostly elderly people and people with low educational profile, it becomes complicated to improve the structural problems.

Prof. Dr. Gökhan Özertan listed the other problems specific to the agricultural sector in Turkey as follows: "Because of economic and social reasons, it is difficult to keep people in the village now. Besides, with ecological problems, sustainability in agriculture has become an important problem. A forecasted 2-3% increase in temperatures will result in a reduction of up to 20% in harvest." Adding that the agricultural sector in Turkey has failed in complying with technology, Özertan shared that only 2% of modern greenhouses use technology.

"R & D investment of Turkey is the lowest among OECD countries”

Özertan, shared the 1981 report of TÜSİAD about the problems that need to be improved in agriculture and stated that the targets mentioned in the report, such as increasing the productivity, preventing the migration from rural to urban areas, distributing the land more equitably and providing equal opportunity to the farmers are still valid despite the years passed. Adding: "For a long time, the problem is determined successfully by the public side, but we couldn’t proceed toward a solution.", Özertan stated the need to assess the debate around a holistic solution, that is not only limited to Turkey but also considering global impacts. "The discussions usually consists only of Turkey, but we also need to look at what is going on in the world. For example, Netherlands has achieved productivity in agriculture by applying a model based on the private sector, public and R&D triangle. Turkey is the lowest among OECD countries, in terms of R&D investment.”.

Underlining that the agricultural sector in the world is changing, Prof. Dr. Gökhan Özertan stated that the value chain, which is accepted as “from field to table”, is no longer finished at the “table”, and that waste management and green growth are included in the value chain following the “table”; “There is a shift from producer-oriented approach to a consumer-oriented approach around the world, and it is now possible to order agricultural products even from the Internet. ”.

Are cooperatives the solution?

Sharing that despite being the largest agricultural economy in the European Union Turkey is the 30th in the world in terms of labor productivity, Özertan stressed that organization and cooperatives will play the key roles to increase productivity in agriculture. “As long as there is no organization in agriculture, it is not possible to achieve cheap input costs. In the European Union, agricultural cooperatives make up 39% of all cooperatives and can compete very well with the private sector. In Turkey, although there are over 12 thousand cooperatives, an average of 200 are successful. In fact, around 30% are ghost cooperatives. The success of cooperatives depends solely on individual effort, and manufacturers often don't even know what the cooperatives serve for.”.

Özertan added that, in Turkey, failure of cooperatives depends mostly on the institutional problems such as opportunistic approaches, lack of confidence, lack of incentive mechanisms and issues in applying the rules besides country specific problems. He also stated: "Cooperatives in certain regions are dominated by certain families and such practices block cooperation of farmers.”.