President Recep Tayyip Erdogan's market project has returned from the brink of bankruptcy! It turned out that 434 million Turkish Liras (TL) were transferred from the Central Union, that is, from the farmer's coffers, to save the Agricultural Credit Markets, which lost all of its capital and fell into debt within a year due to the damage it did. Agricultural Credit Market company's board of directors held an extraordinary meeting in June to raise the capital to save the company that fell into debt. If the company's board of directors had not taken this decision immediately, according to the Turkish Commercial Code, Agricultural Credit Markets would have been dissolved automatically.
DRAGING IT TO THE EDGE OF THE BANKRUPTCY!
President Erdoğan's efforts to reduce food prices with the help of Agricultural Credit Markets by ignoring the exorbitant price increases in agricultural inputs such as diesel fuel, fertilizers and pesticides are pushing Turkey's most rooted farmer organization, Agricultural Credit Cooperatives, to the brink of bankruptcy. While the established markets do not benefit the citizens in terms of cheap food, they also cause the end of the farmer with the farmer's own capital without transferring any resources from the treasury.
RETRIEVE THE MARKETS’ LOSS FROM THE FARMERS!
While a serious resource was transferred from the state's budget to the roads, bridges, hospitals, construction companies that are publicly known as the five gangs, the market project, which President Erdogan attaches great importance to, was established for cheap food, without paying a single penny from the Treasury. The fact that the losses and installation costs of the markets are completely covered by the farmer's own capital also reveals the insincerity of the government on 'cheap food', 'production' and 'farmers'.
EVEN CAPITAL INCREASE WAS NOT SEEN ENOUGH!
Agricultural Credit Markets, which was established at the end of 2020 by dividing the product supply and market leg into two, was initially established with a capital of 2,5 million TL. While the capital of Agricultural Credit Markets was increased to 10 million TL in 2021, the company's board of directors increased its capital to 140 million TL on November 29, 2021. It decides to increase it to 150 million TL. However, Ankara Chamber of Commerce Trade Registry Directorate did not accept the necessary amendment in the decision regarding the increase of the capital to 150 million TL due to the company's insolvency.
LOSS IS COVERED BY CAPITAL INCREASE!
Thereupon, the board of directors of the company had to urgently convene on June 17, 2022 and take two decisions simultaneously. First, the capital was increased from 10 million TL to 444 million TL. The loss of 249 million TL, which is the loss of 2021, was deducted from the increased capital. As the 2021 loss was deducted from the increased capital, the capital of Agricultural Credit Markets decreased to 200 million TL, despite the fact that 434 million TL was put into the safe.
IT MEANS BANKRUPTCY ACCORDING TO THE LAW!
It turned out that Agricultural Credit Markets, which was founded with the claim of providing cheap food to the citizens, and which was not even 2 years after its establishment, fell into a ‘debt-ridden’ situation. While the legal equivalent of the concept of insolvency means that; ‘a business enterprise’s assets cannot meet its debts’, this situation is seen as more dangerous for companies than being ‘incapacitated without paying debts’ according to the Turkish Commercial Code. While at least companies have the ability to pay their debts in 'inability to pay debts', in the case of insolvent, it tells creditors about the inability to pay their debts even if the company's assets are fully exchanged to cash money.
AGRICULTURAL CREDIT MARKETS WOULD HAVE TERMINATED THEMSELVES!
According to the Turkish Commercial Code, Agricultural Credit Markets would have been abolished if the company management had not transferred 434 million TL from the Agricultural Credit Cooperatives by holding an extraordinary meeting on June 17. The fact that the loss and mismanagement in Agricultural Credit Markets made the farmer to pay and closed with the funds obtained from the Central Union revealed Agricultural Credit Markets to serve whom.
434 MILLION TL OF RESOURCES HAVE BEEN TRANSFERRED FROM THE FARMER'S CASE!
While there was a loss of 249 million TL in Agricultural Credit Markets in 2021, 120 million TL of this loss was due to operating expenses and 129 million TL to interest expenses. While the company lost its capital completely due to the loss of 249 million TL, the capital increase of 150 million TL was not considered sufficient. Thereupon, a total of 434 million TL were transferred from the Agricultural Credit Cooperatives, Central Union, that is, the farmer's coffers, to the Agricultural Credit Markets. With the transferred resources of 434 million TL, 249 million TL, which was the loss of 2021, was closed, and the capital of the company was increased from 10 million TL to 200 million TL.
WITH WHICH CAPITAL WILL THE NEW 1,600 MARKETS BE ESTABLISHED?
On the other hand, while Agricultural Credit has 1,400 markets in the current situation, President Erdoğan announced that the number of markets will be increased to 3 thousand in the near future. While Agricultural Credit Markets does not have sufficient capital for the 1,600 markets to be established, these markets will be established entirely with the financing to be used at 35, 40 percent interest from banks. While it is wondered how food prices will be reduced with the markets to be established with a 35-40 percent interest loan, the damage here will be covered by the Central Union, that is, from the farmer's coffers. While President Erdoğan instructed the Agricultural Credit Cooperatives to sell cheap food and increase the number of markets, it is significant that all costs and losses are met from the farmer's own resources, without transferring a single penny from the Treasury for the loss incurred and for the markets to be established.
THE FARMERS' PRODUCTION IS TAKING A BIG BLOW!
As it is known, the primary duty of Agricultural Credit Cooperatives is to provide inputs to farmer partners under suitable conditions by using their own capital. The transfer of the own capital to be used in the supply of this input to Agricultural Credit Markets means less credit to the farmer. The decrease in the amount of credit to be extended to the farmer will directly affect production negatively. In other words, the government, while trying to cover up the increased prices by using the farmer's own capital as a result of the crisis in the economy, on the other hand, it deals a big blow to production.