If in 2014 1 euro was worth 2.90 Turkish lira, today it is traded for 34 lira.
Faced with years of chronic price inflation and insufficient government aid, Turkish farmers sink into debtsto stay afloat, writes Deutsche Welle.
In recent months, across Europe, farmers have taken to the streets to protest, blocking traffic with their tractors. Farmers in Turkey they haven’t taken to the streets yet, but the agricultural sector there is just as angry about the unfavorable economic situation and unhappy about government subsidies. Turkish farmers face worse conditions than their counterparts in Poland, Germany and elsewhere, industry officials say.
“One of the driving forces behind the agricultural protests in Europe was the reduction of aid for agricultural diesel,” said Baki Remzi Suicmez, president of the Chamber of Agricultural Engineers of Turkey. “There are no tax breaks for agricultural diesel in Turkey anyway.”
“While inflation is constantly rising and is almost at the 70% mark, financial support is not enough,” he says.
Annual inflation was 64% last year in Turkey, according to official data. Analysis by the Inflation Research Group (ENAG) puts it at 127%.
Insufficient budget increase
In response, the Turkish Ministry of Agriculture’s budget to support farmers was increased by 44.5% for 2024, totaling around 2.7 billion euros.
By comparison, German farmers received about 6.9 billion euros in agricultural subsidies from the EU, plus another 2.3 billion euros from the national budget in 2022, according to an analysis by the Cologne Institute for Economic Research. (In Bulgaria, Agriculture Minister Kiril Vatev announced at the end of 2023 that a total of BGN 3 billion was allocated to farmers during the year, of which BGN 873 million was state support – b.r.)
In Turkey, the cost of key agricultural supplies has been steadily rising, data from the Union of Turkish Chambers of Agriculture (TZOB) show. Agricultural diesel prices rose 76% last year, for example, while fertilizer costs jumped 25%.
As government aid is insufficient to cover rising costs, Turkish farmers have to take out loans, which means they are sinking deeper into debt, Switchmez said.
Currency crisis
TZOB chief Semsi Bayraktar paints a grim picture. “Our farmers now have to start thinking in the winter about how they will pay for farm diesel in the spring. Agricultural diesel is absolutely necessary for production,” Bayraktar said.
Turkey’s currency crisis has been going on much longer than Europe’s current inflation problem. The Turkish lira has lost its value dramatically. In 2014, you had to pay around 2.90 Turkish lira for 1 euro. Today, 1 euro is worth 34 pounds.
Dramatic jump in debt
The amount farmers owe banks has risen by 80% last year. According to official statistics, they now owe the banks 118 times more than they did 19 years ago.
In contrast, financial aid has not kept pace over the same period, explains Orhan Saribal, a member of parliament from the largest opposition party, the Republican People’s Party (CHP).
Saribal himself is an agricultural engineer and farmer. “In 2004, credits used for production in agriculture, forestry and animal husbandry were 1.7 times more than state aid. In 2023, credits are 9.6 times more,” he emphasized.
Farmers owe about $22 billion, mostly to banks but also to the Department of Agriculture and private companies.
Saribal is calling for more government support. “Farmers do not receive enough support from the state. Therefore, out of desperation, they turn to private banks,” he added.
A significant sector
According to official figures, agriculture accounts for 5.8% of Turkey’s economic output, compared to just 0.8% for Germany or 1.4% for the entire European Union. About 4.6 million people work in agriculture in Turkey, which is 16% of all workers.
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