Place on order for a custom essay, research paper on this or related subject.
The backbone of Cyprus economy when it achieved its independence was agriculture. The major contribution came from small farms and at times from subsistence farms. Exportation of vegetables and fruits were made possible by irrigation projects in the nineteen sixties. The demands for wine, meat and dairy products were met by commercialized farming. In the early nineteen seventies, the farms supplied about seventy percent of commodity exports and employed one third of the island’s active population despite the fact that the farms were still overwhelmingly small. However, the expansion of manufacturing and service sector led to a decline in the importance of agriculture. The share of agriculture’s Gross Domestic Product in the first half of the nineteen seventies amounted to eighteen percent.
The northern Turkish Cypriot community was left in possession of agricultural resources with the nineteen seventy four de facto division of the island. It produced four-fifth of cereal and citrus crops, all of the tobacco and two thirds of the green fodder. The south on the other hand retained the entire island’s grape growing areas and deciduous fruit orchards. The south was also in possession of about seventy fiver percent of the valuable potato crops and other vegetables and half of the island’s olive trees. It also had sixty three percent of its carob trees. Two thirds of the livestock population was also in the south. A large scale uncoordinated exchange of agricultural labor between the north and south was created by the Turkish occupation of the region. This led to agricultural unemployment which was countered by government actions. Such government actions included assisting farmers financially under terms that would enable them to carry out their activities without much burden. By nineteen seventy eight, the number of individuals employed in the agricultural sector under government controlled area constituted twenty three percent of the working population. The agricultural sector’s workforce however declined to 20.7 percent in nineteen seventy nine and 15.8 percent in nineteen eighty seven. Its contribution to the overall economy of the state also declined from 17.3 percent GDP in nineteen seventy six to ten point seven percent in nineteen seventy nine and a further seven point seven percent in nineteen ninety eight. This share was vital to the economy of the south. In nineteen eighty eight, value added in agriculture at constant nineteen ninety five prices amounted to one hundred and twelve million-seven hundred thousand Cyprus pound.
As the service sector increasingly became dominant in the economy of the Greek Cypriots, the share of agriculture in the national economy declined even further in the nineteen nineties. However, the favorable climate of the region and the availability of market owing to its location still mean that agriculture will continue playing an important and stable role in the overall economy. The irrigation projects set by the government, tax policies and subsidies encouraged the existence of farming as well as research in exotic crops and new varieties of the ones that already exist. The effort to improve agriculture, forestry and fishing was overseen by the Ministry of Agriculture and Natural Resources. This ministry was supported by Agricultural Research Institute, Meteorological Service, Department of Water Services, the Veterinary Service and the Department of Geological Survey. All these departments worked together in formulation of policies that affect the sector. The government also encouraged agriculture in addition to macroeconomic considerations since it offered the rural population employment which maintained village life and relieved urban crowding. Part time agricultural work also allowed the urban residents to maintain contact with their villages beside offering them supplemental income.
The contribution of agriculture to the national economy has steadily declined. However, in the past decade it has stabilized between three and four percent. In 2004, the contribution of agriculture to exports went up to twenty four percent which is the highest since nineteen ninety six. This is near the historical thirty four year average. The number of individuals employed in the agricultural sector has also declined remarkably. In 2005, only four point eight percent were employed in the agricultural sector as compared to about thirty percent in nineteen sixties. This percentage is however higher for men at 5.7 percent than women at 3.7 percent. Of this population, about are holders and family members while the remaining one out of five are employees. These numbers are larger in crop than in livestock sector. Since 2001, full time working equivalent has been around seven percent.
In 2003, the gross agricultural output went up and remained steady through 2004. However, with regard to quantity, the crop output has been steadily falling and is about eighty eight percent of what it used to be in nineteen ninety five. On the other hand, livestock output has been going up and now stands at above one-hundred percent of the nineteen ninety five figures. In 2004, prices were fourteen percent higher than in 1995 with the crop prices recording higher percentage points than livestock prices. Crop prices were between five to twenty percent higher even though the gap is being closed by livestock prices.
Overview of agricultural and rural sector development
Crop area consist of thirty percent permanent crop area and seventy percent temporary crop area. About forty to forty five percent of the total area hold cereals with fifteen to twenty percent of the total holding fodder crops which shows a decrease after a steady increase until two thousand. Vine area has recorded a decrease from eighteen percent in nineteen ninety to eleven percent of the total in two thousand and two. This was largely due to the incentives that were paid to farmers in an attempt to avoid overproduction of vines. A small increase was exhibited by olives on olive oil production to eight percent of the total. Citrus recorded a decrease by one percent in the year two thousand but has then been stable. Three percent of the total area is occupied by fresh fruits. Both the fresh fruits and citrus are completely irrigable. Uncultivated land remained relatively constant at between thirty five and forty percent of the total area.
The most extreme fluctuation was recorded by barley with thirty seven thousand tons being produced in the year two thousand as compared with one-hundred and twenty eight thousand tons produced two years later. An average yield of two point four tons per hectare is represented by the 2002 production. The fluctuation highlight Cyprus’ periodical water shortage and the annual weather changes. The falling grapes production represents the decrease in the cultivated area. After a big decrease in the year two thousand, the production of grape fruit has steadied. Generally, the production of citrus fruits has shown a gradual decrease since nineteen ninety but it has steadied to some extent during the past few years. Extreme fluctuations are not often recorded by potatoes but their massive share in agricultural output and exports implies that their fluctuation impacts greatly on agricultural economy. Olives have constantly increased to reach more than twenty seven thousand tons. This figure is twice what it was some few years ago. This can be attributed to the increase in irrigable land.
These figures however show the general agricultural output. The basic problem that Cyprus agricultural sector is faced with is the problem of competitiveness and marketing. Many policies have been channeled towards supporting the farmers so they may be competitive.
Agricultural and rural policy developments.