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Proceedings: 3rd International Conference on Food and Agricultural Economics: THE TRANSFORMATION FROM MEMLEKET SANDIKLARI AS AGRICULTURAL DEVELOPMENT PROJECT TO THE LARGEST BANK OF TURKEY: THE ESTABLISHMENT AND ORGANIZATION PROCESS OF ZIRAAT BANK IN OTTOMAN PERIOD

Mehmet Guner

No 296793, 3rd International Conference on Food and Agricultural Economics, April 25-26, 2019, Alanya, Turkey from International Conference on Food and Agricultural Economics

Abstract: According to the data of the year 2019, Ziraat Bank, the largest bank in Turkey, was established in 1888. The foundation of the Bank is a summary of the reforms undertaken by the Ottoman state in agriculture and the problems it faced during this period. Memleketsandıkları was an improved solution to enable small farmers to access low-cost financing. Founded by Mithat Pasha in 1863, the memleketsandıklarıis considered as the first example of agricultural cooperatives. It is an organization model that allows farmers live in a specific region to gather funds and use these funds in accordance with certain rules. The project, which was implemented in the Ottoman state for 20 years, was restructured in 1863 due to lack of capital and corruption. In this context, the name of the memleketsandıkları was changed as menafisandıkları, a percentage added to the over ten percent tax from farmers in order to provide capital support and menafisandıkları were subject to the control of the Ministry of Commerce. Although menafisandıkları support agricultural activities and farmers, it was decided to establish Ziraat Bank as a result of the development of banking activities and a national bank search of State administrators. Menafisandıkları are transferred to the bank with their assets and liabilities. Thus, the process started with the memleketsandıklarıwas completed with the establishment of Ziraat Bank. Since its foundation, Ziraat Bank has been an alternative source of funding for farmers and has supported farmers financially. In the bank's contract of association, it was decided to allocate one third of the bank's profits to the capital while two thirds to be used for agricultural reforms. This fund has made significant contributions to the implementation of agricultural reforms in the Ottoman Empire. In addition, Ziraat Bank was institutionalized as a bank and encouraged structural developments in the agricultural sector. The aim of this study is to present the process of establishment of Ziraat Bank, which is shown as the first example of agricultural cooperatives.

Keywords: Agribusiness; Agricultural Finance (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ara
Date: 2019-04
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Persistent link: https://EconPapers.repec.org/RePEc:ags:icfae3:296793

DOI: 10.22004/ag.econ.296793

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