18 February 2019 22:46

Direct sale points of Erdoğan government in 7 questions

Why have vegetable and fruit prices gone up in Turkey? Will direct sale points cure citizens’ woes? Are market traders to blame? We made a collation of the points of concern.

Photograph: Evrensel

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Sinem UĞUR
İstanbul

The direct sale points proposed by the AKP-Erdoğan government with the purported aim of reducing fruit and vegetable prices have been up and running since Monday 11 February. The rise in vegetable prices, which have reached record levels, will purportedly be stemmed through sales made at fifty points in İstanbul and fifteen in Ankara.

Will the direct sale points that have both attracted interest and prompted debate cure citizens’ woes? Why have prices risen? Who is to blame? What do the government, opposition and citizens say? We have replied to these questions by imparting the views of experts and politicians.

1- WHY HAVE FRUIT AND VEGETABLE PRICES RISEN?

Farmers' Union Tüm Koy Sen Training and Organization Expert Sedat Başkavak gave an itemized reply to our question.

•    The country’s agriculture is configured to align with monopolies’ interests. (Whenever agriculture is debated import policies constantly come to the fore instead of policies that will increase production. Agricultural production and produce prices are kept under pressure with the imports that are made. This also affects agricultural production because these practices tear producers and villagers away from agriculture. Agricultural production has been annihilated as a result of the WTO and EU’s impositions.)

•    Support for production is minimal. Input prices are high. (Diesel leaving the refineries fills the villager’s tractor with a price hike of more than 100% due to the distributor’s, transporter’s and vendor’s profit. Pesticides are imported, fertilizer is imported and the monopolies set the price. As such, the producer and villager, unable to match production costs, grow produce each year as if playing the pools to see which produce will make good money. Agricultural production has become unbalanced in this way.)

•    It is the companies, commission agents and chain supermarkets that set the prices of vegetables and fruit, not the producing villager. (Unorganized, the villager cannot set the price of the product he produces. Intermediaries, traders and supermarket chains impose whatever price they want, saying this is the market price. With them getting their profit, the villagers are sometimes left unable to recoup their costs let alone the labour they have put in.)

•    Climatic conditions that have made themselves felt more this year. (Production has been negatively affected by climatic conditions. Weeks of flooding and storms have left their toll on production in areas where vegetables are produced. Agricultural areas are still under water in some places. Villagers are not being compensated for losses they have suffered from natural disaster. Intermediaries are exploiting this situation to increase prices.)

2- DOES THE BLAME LIE WITH MARKET TRADERS, SMALL BUSINESS PEOPLE OR PRODUCERS?

Chair of the İstanbul Branch of the Union of Chambers of Turkish Engineers and Architects’ Agricultural Engineers Chamber, Ahmet Atalık, indicated that market traders, producers and sellers were not to blame and pointed to cost and expense items. There follows a summary of Atalık's comments to Evrensel:

“We cannot say market traders, sellers and small business people are to blame. These people pay tax, pay rent, employ staff, pay staff wages and insurance contributions and pay electricity, water and natural gas bills. There are a whole host of cost items. If we want cheap food these items need first of all to be made more tolerable.

They say, ‘We just take the cost of diesel at direct sale points and sell at the farmers’ prices.’ They don’t pay rent and there are no tax or electricity costs at the places they make sales. Can you now, under these conditions, say, ‘Look, I am providing this service and they are food terrorists?’

Even the produce sold at direct sale points where not a penny in profit is said to be made is very expensive. This is because fertilizer has been hiked by more than 100%. Pesticides have been hiked by up to 80%. The producer uses diesel, pesticides and fertilizer coming from abroad. The slightest increase in foreign exchange is reflected in costs. Our total agricultural area has declined by 3.2 million hectares. The farmer doesn’t grow because he can’t get compensation for his labour.”

The words of market traders and producers who spoke to DHA bear Atalık out.

Finike Wholesale Market Association Chair İsmail Karataş said, ‘The cost of the produce the producer grows is very high. If our state wants to get people eating cheap vegetables it must first reduce the costs of the produce he grows. The produce isn’t beamed from here to the major centres. There is a transportation cost for this. Diesel is six lira a litre. The small business people there invoice for this and pay tax. This is also a cost for small business people. What our state could do would be to eliminate tax entirely, municipalities could dispense with duties and withholding tax could be done away with and prices would fall.”

Producers Süreyya Dalgıç and Emine Baş commented, “What we expect from our state is cheap diesel and fertilizer prices becoming cheaper and taxes being abolished.” For his part, farmer İsa said, “Our state must know how high costs are. So, they first need to revise costs.”

3- WILL DIRECT SALE POINTS CURE CITIZENS’ WOES?

Evrensel newspaper’s Economics Editor Bülent Falakaoğlu stated that direct sale points will not meet needs.

“The TANSAŞ model in 1980’s Izmir gives us an insight into this issue. The model brought farmers and supermarkets into a coordinated mode of working and cut down on intermediaries. With quality produce made available to the people more cheaply, the farmer was provided with a share of the income enabling him to continue producing. The TANSAŞ model only achieved effectiveness after it had spread throughout the entire Aegean region. 

It is now virtually impossible to affect food prices with a limited number of direct sale points and limited produce!

Do fifty direct sale points suffice to meet needs in Istanbul, with its population of fifteen million, or fifteen in Ankara with a population of six million?

It has no producer component, no supermarket component and no reach. Hence, it has no chance of succeeding, either. It will aid the certain number of citizens who join the queue, but that won’t last long, either. Without solving the problems of expensive motorways and bridges, expensive diesel, high taxes, high rents and farmers’ production costs, prices won’t fall.

The farmer has a production problem. The price given for produce doesn’t meet costs. With the farmer not growing produce because it doesn’t pay, where are the fruit and vegetables to come from to the direct sale point?”

4- ARE DIRECT SALE POINTS A SOLUTION STRATAGY OR ELECTION STRATAGEM?

CHP Niğde Member of Parliament Ömer Fethi Gürer responded as follows to this question: “Direct sale points are being implemented for the perception to be created until the election that prices have fallen and it was the producer and intermediary that were to blame.”

Speaking to Evrensel, Gürer reeled off his criticisms of the AKP’s agricultural policy as follows: “Seeds, fertilizer and insecticide are imported and expensive. Diesel and electricity hikes affect production. Transport costs attributable to road and bridge transit implementations increase the price of produce.”

Stating that direct sale points were a for-show arrangement to say that prices had fallen, Gürer said, “Until farming inputs are cheapened and scientific, planned and foreseeable support is given to the producer, no lasting solution can be created. The fault lies with the AKP General Chair’s incorrect agricultural policies and externally-dependent practices.”

5- WHAT HAVE THE GOVERNMENT AND OPPOSITION SAID ABOUT DIRECT SALE POINTS?

President Tayyip Erdoğan harbingered the setting up of direct sale points on 5 February. Erdoğan said in the speech he made to the AKP Parliamentary Group Meeting, “Be it peppers, be it aubergines, be it tomatoes, for everything we have decided to put a check on these prices if need be and we will take our steps. We will take these steps through our municipalities. You know, at one time regulated sales were set up. We can and will take these steps through our municipalities because we have to give our citizens cheap and healthy produce.”

In response to these words of Erdoğan, Minister of Treasury and Finance Berat Albayrak said that direct sale centres would be set up.

Erdoğan said at his party’s Kastamonu rally on 12 February, “From now on the tents have been set up and with these we have set up sales places that are virtually like direct sale points. Prices have halved in an instant and will fall further because we will sell other products there. I mean, take cleaning products and whatever else there is in supermarkets. We will start selling a certain portion of these here, too. Why? Because they whipped up terrorism, terrorism. So, we have given, are giving and will give those who whip up terrorism in food the necessary lesson.”

CHP Spokesperson Faik Öztrak, commenting after the CHP Central Executive Committee on 11 February, stated, “Direct sale points alone are not enough. The components of this project are insufficient. You cannot tackle the burning problem in the kitchen without tackling the burning issues in agriculture and in the field.”

HDP Co-Chair Sezai Temelli said at the HDP Group meeting on 12 February, “Today, Erdoğan is obsessed with aubergines. He asks the people how many lira a bullet costs. A huge perception operation is underway in conjunction with the crony media with direct sales at fifty points in massive Istanbul. As if the producers themselves had not folded up, market traders and small business people are being declared enemies.”

Speaking at the Good Party group meeting on 12 February, General Chair Meral Akşener commented, “The state’s most strategic factory is being transferred to the private sector. They are going to get the state to sell potatoes and tomatoes. The way things are going, don’t be surprised if they ration tomatoes and peppers. Supposedly the opposition speaks of tomatoes and peppers. What are we to say? This is what we eat. How about you speak of the dragon fruit ‘smoothie’ you eat at the Palace.”

6- WHAT HAS THE CITIZEN SAID ABOUT DIRECT SALE POINTS?

Evrensel reporters spoke to citizens waiting in the queue at the direct sale point in Şirinevler. There are both those at these points who are satisfied and those who think they won’t deliver a cure.

According to the report, one citizen said, “Let those who brought this to this state be ashamed. Is this a solution, I mean? Are people to stand in line for fruit and vegetables? After diesel, fertilizer and seed prices were not reduced, nothing will happen. Cosmetic measures will do nothing without supporting the producers.”

Another citizen thinks these points will teach supermarkets and markets a lesson: “I think it was welcome. Let it teach the supermarkets a bit of a lesson. This was opportunism. They’re taking advantage of the foreign currency rise.”

7- WHAT ARE SIRECT SALE POINTS AND WHEN DID THEY FIRST COME ABOUT?

Direct sales first began to be implemented for the purpose of selling products to the people at more affordable prices in the 1970’s when Bülent Ecevit headed the Republican People’s Party (CHP). The initiative was centred around municipalities. This initiative started with an idea by İzmir Gültepe Mayor Aydın Erten and his deputy İlhan Güre. İzmir Mayor İhsan Alyanak launched a similar initiative in Alsancak.

Tansa, opened by the municipality in Izmir in 1973, and the direct sale shops set up in certain sub-provinces of Istanbul in 1976 spread rapidly.

The main aim through these shops was to obtain products directly from the producer or from cooperatives and circumvent price increases by eliminating the intermediary.

Izmir Tansa subsequently attained the name of TANSAŞ and turned into a supermarket chain. TANSAŞ was bought by Migros in 2011.

Direct sale shops were closed at the end of the 1990’s.

Translated by Tim Drayton