Turkey Agricultural Newsletter #2
Our latest agricultural news on the establishment of food and agricultural products markets analysis division and the annoucement of the Ministry of trade about the new steps against exorbitant price practice. - 11 maart 2021
Establishment of Food and Agricultural Product Markets Analysis Division
Amid the rising concerns in the rise of food prices and their potential risks to the price stability, the Food and Agricultural Product Markets Monitoring and Evaluation Committee (known as the Food Committee) held a meeting, chaired by the Minister of Treasury and Finance Lütfi Elvan, with the participation of Minister of Agriculture and Forestry Bekir Pakdemirli, Minister of Trade Ruhsar Pekcan, Governor of the Central Bank Naci Ağbal and Head of the Presidency’s Strategy and Budget Directorate İbrahim Şenel. During the meeting, the participants discussed local and global price developments in processed and unprocessed food, mainly focusing on the impact of the pandemic on food prices and shared their expectations for 2021. The Committee has agreed on the institutional cooperation framework for the establishment of an Early Warning System for agricultural products and food market, which will help better forecasting future production and price developments in the food and non-alcoholic beverages categories.
In light of this latest decision, on 3 February 2021the Central Bank announced the establishment of three new divisions: the “Food and Agricultural Product Markets Analysis Division” under the Structural Economic Research Department, “Participation Banking Division” under the Banking and Financial Institutions Department and “Financial Control Division” under the Budget and Financial Reporting Department.
The Food and Agricultural Product Markets Analysis Division is established in view of ensuring an early warning function mainly by carrying out a detailed and timely analysis of data as regards prices of food and agricultural products and preparing the research report, expected to contribute to the monetary policy-decision making process.
New steps against exorbitant price practice
On 27 January 2021, the Ministry of Trade announced that Turkish regulators launched nationwide price audits across all the 81 provinces. In one week, a total of 1,674 businesses have been audited and 22,535 products (mostly food and basic goods) have been under scrutiny. As a result of these audits, 495 firms have been found to have been charging exorbitant prices. The total amount of the administrative fines imposed by the Unfair Price Evaluation Board reached TRY 15.5 million (EUR 1.8 million). It has been stated that the audits would become more intensive in the upcoming months.
It is worth mentioning that the Ministry of Trade published an amendment to the Regulation on the Unfair Price Evaluation Board in the Official Gazette No. 31386 dated 5 February 2021. According to this amendment, the Board can impose administrative fines even if a manufacturer, a supplier or retail business has failed to submit their defence and the time granted to provide defence decreased to no less than 7 days (plus one extension of up to 7 more days). As a comparison, prior to this amendment, the audited undertakings were given no less than 10 days from the day of the inspection (plus possible one extension of up to 10 days) to provide their defence and the Board could not impose the fine (except when the undertaking refuses to provide its defence) without the undertaking’s defence.