Turkey's accession to the EU : what will the Common Agricultural Policy cost? / Harald Grethe

Abstract

At the EU Council in December 2004, European heads of governments will decide on a potential date for the start of EU accession negotiations with Turkey. Various recent analyses assess the cost of applying the Common Agricultural Policy of the EU (CAP) to Turkey without taking into account the specific structure of the agricultural sector in Turkey, which would determine the receipts from EU funds. This paper assesses potential budgetary effects resulting from the application of the CAP to Turkey, if Turkey should accede in 2014. The analysis is based on macroeconomic projections from the literature, equilibrium modelling of the Turkish agricultural sector, and projections of the future development of the CAP. It is found that total EU budgetary outlays for the application of the CAP to Turkey could total about €3.3 billion in 2014 and rise to €5 billion in 2024 due to full phasing in of direct payments and rural development policies. The resulting net transfer under the CAP to Turkey would be about €1.6 billion in 2014 and could increase to €2.6 billion in 2024. Such sums take a backseat to projected transfers under the structural policy of the EU and the overall political project of including Turkey in the EU.