Agricultural Support Programs

Agricultural support programs are the comprehensive set of policies and instruments implemented by states to support the agricultural sector in line with various economic, social, and political objectives. Despite global trends toward liberalization, these programs continue to exist, and in particular developed countries, agriculture remains one of the most protected sectors. Support levels may vary according to agricultural subsectors and production lines.

Development of Agricultural Support Policies in Türkiye

Agricultural support policies in Türkiye have undergone several phases since the founding of the Republic.

• Early Republican Years and Planned Period: In the early years of the Republic (1923–1930), a liberal economic policy was pursued, and important steps were taken such as the abolition of the Aşar tax and the granting of land ownership rights to farmers. In 1932, the first price support mechanism was introduced through the Wheat Protection Law, and in 1938, the Office of Agricultural Products (TMO) was established to create an institutional framework for support purchases. From the 1960s onward, Türkiye entered the Planned Development Period, and agricultural policies were defined through five-year development plans. During this period, price interventions and incentives for input use became prominent. The number of supported products increased over time.
• Post-1980 Period: With the January 24, 1980 decisions, a policy of market liberalization was adopted, input and product supports were reduced or eliminated, and privatization of public institutions became a priority. The number of supported products decreased during this period, but increased again in the 1990s. Support purchases were restricted and input subsidies were limited by the economic stabilization measures of April 5, 1994.
• 2000s and the Agricultural Reform Implementation Project (ARIP): Significant changes occurred in Türkiye’s agricultural policies during the 2000s. Key drivers of these changes included European Union (EU) accession negotiations, World Trade Organization (WTO) commitments, and agreements with the International Monetary Fund (IMF) and the World Bank (WB). In 2001, the Agricultural Reform Implementation Project (ARIP), initiated under World Bank financial support and IMF commitments, brought major policy shifts. Under ARIP, price supports, input subsidies, and credit supports were abolished, and the Direct Income Support (DIS) system was introduced. DIS consists of payments based on land area, independent of the type of product produced or its market price. The DIS system ended in 2008.
• Other Developments After 2000: During this period, important legal regulations were enacted, including the Sugar Law (2001), Organic Farming Law (2004), Agricultural Insurance Law (2005), Seed Law (2006), and Biosafety Law (2010). Law No. 5488 on Agriculture entered into force in 2006, defining the objectives, principles, and support programs of agricultural support policies. In 2009, the “Türkiye Agricultural Basins Production and Support Model” was implemented. In 2017, the National Agriculture Project was launched.

Key Support Instruments and Types

The main agricultural support instruments applied in Türkiye are as follows:

• Area-Based Supports: Direct Income Support (DIS) was included in this category. Currently, diesel, fertilizer, and soil analysis supports are implemented on an area-based basis.
• Price Differential Supports (Premiums): These are payments made to producers to cover the difference between the market price and the target price. This support is targeted at products with supply shortages and strategic importance.
• Livestock Supports: These include various components such as per-head payments and feed crop supports. In recent years, their share of total support has increased.
• Rural Development Supports: These are project-based supports aimed at strengthening agro-industrial integration. The Pre-Accession Instrument for Rural Development (IPARD) Program under the European Union falls within this category.
• Agricultural Insurance Supports: Implemented through state-subsidized premiums via the Agricultural Insurance Pool (TARSİM).
• Other Supports: Additional supports include input subsidies (seeds, seedlings, etc.), compensatory payments, biological control supports, agricultural advisory services, and farm accounting data network registration supports.

Budgetary and Financial Dimensions

According to Article 21 of Law No. 5488 on Agriculture, the resources allocated from the budget to agricultural support programs must not be less than one percent of Gross National Income (GNI). However, this threshold has not always been met. For example, in the 2008 budget, resources equivalent to 0.6% of GNI were allocated. In 2019, the total resources allocated to agriculture amounted to 26.5 billion TL, of which 16.1 billion TL was designated for agricultural support programs.

Türkiye’s level of agricultural support varies over time according to Producer Support Estimate (PSE) data. In 2019, 13.52% of the gross value of agricultural production in Türkiye resulted from implemented agricultural policies. This ratio is below the averages of the EU and OECD but above that of the United States.

International Interactions and Assessments

Türkiye’s agricultural policies are significantly influenced by efforts to align with the European Union’s Common Agricultural Policy (CAP), as well as relations with international organizations such as the WTO, IMF, and the World Bank. In particular, the reforms of the 2000s were a direct outcome of these interactions.

The Organisation for Economic Co-operation and Development (OECD) uses indicators such as the Producer Support Estimate (PSE) and Consumer Support Estimate (CSE) to measure agricultural support. PSE represents the total income transfers from taxpayers and consumers to producers resulting from agricultural policies. Türkiye’s CSE values are generally negative, indicating that consumers transfer income to producers, meaning they pay more for agricultural products than world market prices.

A study applying Becker’s (1983) model found a nonlinear relationship between the size of a supported production sector and the level of support, and the data from 12 agricultural production sectors in Türkiye confirmed this model. The same study concluded that as national income increases and elections approach, agricultural production sectors receive greater support.

Criticisms and Evaluations

The effectiveness and impacts of agricultural support policies are subjects of ongoing debate. Commonly evaluated issues include the fiscal burden on public budgets, market distortions, effects on income distribution, and contributions to rural development. Criticisms have emerged regarding the DIS system introduced after the 2000s, arguing that it negatively affected rural development, contributed to alienation from production in rural areas, exacerbated poverty, and turned Türkiye into an importer of certain agricultural products.

Despite increasing agricultural support, agricultural GNI has remained nearly stagnant, raising questions about the effectiveness of support policies. Moreover, the frequent changes in support policies and the large number of support items make policy implementation and administration more difficult for policymakers.