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Consequences of state agricultural policy

Except for the irrigated sub-sector, with fewer than 50,000 farmers, state policy has consisted for over two decades in extorting a growing surplus at the expense of the vast majority of the Tunisian peasantry, so that:

a) the peasantry has been kept in a sometimes tragic situation of poverty where it is unable to set aside the necessary savings to preserve and improve its means of production. The 1980 national household budget survey reveals that almost half the rural population is living below the poverty line and that, out of a population of 1.865.000 persons living below this threshold (set in 1962 at 50 dinars per head per annum, equal to 120 dinars at 1980 prices). 1.473.000 live in the rural areas and 392.000 in the urban areas. This means that four out of five 'poor people' live in the rural areas whereas the rural population represents less than half the country's total population. How then can it produce the incomes necessary for productive investments?

b) capital, 'the bearer of capitalist rationality', has invested less and less in agriculture as a result of the fact that the prices of essential agricultural products barely cover production costs.

The consequences of this situation are a significant falling-off of investment, a virtual stagnation of production, an increased food deficit and a retention of small and medium-sized family holdings.

Falling-off investment, stagnation of agricultural production and food dependence

Whereas the rural population represented almost 45%, of the total population during the 1960s and 35% in 1980, agricultural investments represented barely 20% of the total in the 1960s and 12% between 1970 and 1979. As a result, agricultural production virtually stagnated: the balance sheet drawn up on the occasion of the preparation of the Sixth Plan for 1982-86 reveals that agricultural value added rose in constant prices by only 1% per annum between 1962 and 1971 and 2% per annum between 1972 and 1981.

Since homogeneous statistical series for the last two decades do not exist, the movement of the production of each of the leading commodities can be reliably measured only for the period 1971 to 1981. During that period, the production of commodities, whose prices are officially fixed, virtually stagnated: that of cereals rose at an average rate of 1.1% per annum, of meat (not including poultry) at an annual rate of 1.7% and that of oil olives even declined by I. I % per annum, while production of vegetables experienced an annual growth rate of 5.3% and that of fruit 6.2%.

During the 1960s, the growth of production was even slower since agricultural value added grew half as slowly as during the 1970s. Consequently, from being an agricultural surplus country. Tunisia was transformed increasingly into a deficit country: immediately after independence, the country had a rate of cover of its food imports by its exports of over 200% until 1960: after 1961, and until 1966, this rate of cover fell to an average of 150%: after 1967, the deficit became structural, the rate of cover, except for 1972, was around 80% but after 1977, the situation became serious since less than half of Tunisia's food imports were covered by its agricultural exports.²⁰ During 1980, 1981 and 1982, the rate of cover fell below one-third and the deficit rose to 141 million dinars per annum.

Given that during these three years the value of agricultural production reached an average of 642 million dinars, it emerges that the food deficit equalled 22% of national production by value. But what must still be pointed out is that this food dependence forms an essential part of the country's financial dependence since the deficit in question represents no less than 60.5% of the deficit in the current account balance and 66.7% of that in the balance of payments.

Apart from the amounts, what is particularly serious is that the dependence relates to strategic food staples: today, national production covers only 55% of cereal needs. 40% of dairy product needs and a tiny part of those for sugar. Moreover, these three leading products alone represent over two-thirds of total food imports and nine-tenths of our deficit.

Retention of small and medium-sized family holdings

After two decades of extracting a growing surplus from the essential products of agriculture, small and medium-sized holdings based on family labour have been consolidated. This is a major trend, due not to some imaginary 'resistance' by a pre-capitalist sector to the development of the capitalist mode of production, but to state policy. In fact, if it is happening, it is because profit-seeking capital has hardly been attracted to a sector where the fixed prices cover only the strict production costs and because it is this peasant agriculture-subject to fixed prices and unable to avoid production even where these prices are particularly low- which best facilitates this transfer of value to the benefit of non-agricultural capital. For unlike capital, the peasant and his family are obsessed neither with realizing a profit nor with realizing a rent but quite simply with surviving.

Stabilizing agrarian structures and keeping wage labour in narrow limits are typical features of the evolution of the agricultural world: the principal contradiction is not between the agrarian bourgeoisie and the agricultural proletariat (or poor peasantry) but between the vast majority of the peasantry and 'urban' capital (through the continual decline of the prices of essential agricultural commodities and the reduction of the farmer to the status of a home worker on sub-minimum wages). On top of this formal subjection of the peasantry to urban capital, the agricultural world is also witnessing the exploitation of a proletariat and semi-proletarian peasantry by big capitalist farmers and the development of new forms of surplus extortion through the ownership of mechanical means of production (tractors, harvesters and so on).

Stabilization of agrarian structures: Thanks to the survey of agricultural structures conducted in 1961-62 and the series of basic agricultural surveys that have been carried out annually since 1976, it is possible to analyse the broad changes occurring in the agricultural world.

Tunisian agriculture is still characterized by a very unequal distribution of land: between 1961-62 and 1980 the number of farmers has increased only slightly (from 326.000 to 355.000, at most 9%): small and medium-sized holdings neither in number nor area (less than 20 ha and 20-100 ha) have declined, but their numbers rather increased (320.700 in 1961-62 to 350.600 in 1980, from 98.4% to 98.8%) and the area they occupy also increased from 3.572.000 ha to 3.779,000 ha (74.1% to 81.5%): large holdings (over 100 ha) seem to have lost some importance both absolutely and relatively: the area they cover fell from 1.250.000 ha (1961-62) to 858.000 ha (1980) (from 26% to 18.5%) and the number of farmers (5.100 in 1961-62. 4.400 in 1980) fell both relatively and absolutely.²¹

On average, the size of large holdings fell from 245 ha to 195 ha while that of small and medium-sized ones stabilized (at 6.2-6.3 ha²² for the former and 36-37 ha for the latter).

Relations of production: Within agriculture these relations have become more complex; wage labour does not seem to have increased much, indeed rather the reverse. What strikes one first is an absence of the development of capitalist relations of production involving an ever-rising number of capitalist farmers (or bigger capitalists) and wage labourers with only their labour power to sell. But a new dynamic has made its appearance: it is no longer crystallized through ownership of land but through mechanical means of production: tractors, harvester threshers, harvester binders for example.

The fact is that small producers have found themselves more and more driven to deal with the continuous decline in the prices of their products by turning to modern means of production. Lacking the means to acquire them, they are obliged to hire them. And precisely behind this 'hiring' relationship lurks a new relationship of exploitation, from which the owners of these means of production extort a large part of the surplus produced by the peasantry.

Comparison of the 1961-62 survey with those carried out in recent years also reveals a stabilization or even a diminution of the number of wage-earners in agriculture.

Thus, during the four years 1977-80, the average number of permanent wage-earners was 54.200 as against 72.600 in 1961-62, although there was an increase in the size of the permanent labour force (546,300 in l961-62.593.200 over 1977-80): more and more, it seems that agriculture relies on family labour (473.700 in 1961-62. 539.000 over 1977-80) which now represents nine-tenths of the permanent members of the labour force.²³

Clearly the consolidation of independent family agriculture and the failure of wage-earning to become the norm. Recognition of the fact that this 'inevitable creation of a minority of capitalist agricultural holdings based on wage labour' and the concomitant polarization between proletarianized peasants and a rural bourgeoisie are just not happening is unavoidable. But because their land does not support them, many farmers have to sell their labour power to obtain some extra income. Wage labour is thus not a separate status: the majority of the peasantry has recourse to it more or less partially. And today almost two-fifths of smallholders devote most of their time to outside work, usually as wage labourers.

It must, however, be noted that this 'semi-proletarian' character of the peasantry seems to have diminished since 1961, as the proportion of small peasants devoting more than six months to activities other than their farms fell from 53.7% to 38.1% in 1980. The number of big absentee farmers seems to have diminished too.²⁴

In 1961-62, only 18.5% of farmers had recourse to mechanical means of production: today, almost two-thirds of them do.

The users of these means of production are not only the big farmers: the proportion of smallholders using them rose from 13.2% in 1961-62 to 52.2% in 1980 and of medium-sized farmers from 38.2% to 77.7%: in the space of two decades the number of smallholders using mechanical equipment rose by a factor of 4.5 and that of medium-sized farmers by 2 to 2.5.²⁵

The vast majority of these users, however, is made up of people who hire the equipment. While in 1961-62, there were 9.560 owners of such equipment and 44.290 hirers (or one owner for 4.5 hirers), today there are 11.700 owners and 187,800 hirers, or one owner for 16 hirers.²⁶ And behind this 'hiring' lie concealed relations of production through which the owners extract part of the surplus peasant labour and pass on to the 'hirers' the price loss that they themselves suffer (when they are farming at the same time) as farmers

Studying the village communities in the region of lake Alaotra (Madagascar) where the state has carried out an 'agrarian reform' (redistributing land to small and landless peasants and banning dealings in land). J. Charmes²⁷ shows that because the problem of providing small peasants with equipment has not been solved, they have been unable to liberate themselves from their former masters, 'who soon realized that the monopoly of capital had become the new channel through which the old relations of domination were to be perpetuated'.

The progressive disintegration of ground rent led to some redistribution of clienteles, i.e of the labour force creamed off by those with power: in particular, a rising class (the class of owners of mechanical equipment) has made its appearance it has been able to carve out a niche for itself at the expense of the former landowners who have not always known how to grasp the opportunity of adapting themselves as the situation required

Closer to home, in Tunisia. Khalil Zamiti studying the village of El Menara (55 km south-west of the city of Kairouan), highlights this extraordinary form of surplus labour constituted by the 'hiring' of agricultural equipment by the owners at the expense of the peasantry.

At a rate of 1.70 dinars per hour for ploughing and 2 to 6 dinars for towing the water tanks intended for irrigating the olive groves, each tractor hired for 300 days a year, within the cheikhat, brings in for its owner a net profit of 10 dinars a day, after deducting the costs of repaying the price of the machine and the costs of fuel, maintenance, etc. Repayment of the supplier of the tractor is completed by the end of the third year

Far more than owning and farming the land, owning modern agricultural equipment is tending to become the essential form of surplus extraction within the agricultural sector.

The monopoly of land is tending less and less (or has even ceased aItogether) to be realized economically. It is more and more in the monopoly of machine capital that the extraction of surplus labour and the new contradictions in the agricultural world are crystallizing.

To summarize. Tunisian peasants are suffering a double extraction of surplus labour. 'personal' extraction by the owners of machinery and 'impersonal' extraction by extra-agricultural capital through the under-pricing of their products whose prices do not even remunerate their labour power at the minimum agricultural wage.

Current situation and prospects

Such was the situation in agriculture broadly speaking up to 1979. Since then, new trends seem to be appearing. These are shown in the unprecedented revaluation of commodity prices previously held down and even the freeing of some of them as well as in the enhanced role that the Sixth Plan for 1982-86 gave agriculture in the country's economic activity and the institutional and financial means now made available to farmers.

This turnaround, it must be stressed, was not dictated either by pressure from the peasantry or by any change in the composition of the ruling bloc. The peasantry, atomized and with no real power to make demands, does not strictly speaking represent a social force. Behind the new agricultural policy- or what is just its early beginnings - there are in fact the unprecedented upsurge of the world prices of agricultural products, the level of which has, in some cases since 1979-80, risen above domestic prices, and the dramatic deficit in the food balance. This last is fundamental since government's attitude towards the rural areas depends on how it moves any collapse in world prices threatens to lead to a reconsideration of the policy of encouraging agriculture embarked on over the last two or three years while a rise in them may well lead to a consolidation and reinforcement of this turnaround.

The new agricultural policy and its content

Until 1979, as we have seen, the prices of the main agricultural products (cereals, beef and veal and sheepmeat, milk, olive oil) were set by the state and, from the early 1960s, were continually undervalued. And, although employing two-fifths of the total economically active population, agriculture was attracting a smaller and smaller share of investments: one-fifth during the 1960s and one-eighth during the 1970s. After 1979-80, all this changed.

Revaluation of the prices of agricultural commodities: Whereas they had remained virtually stagnant from 1975 to 1979, the nominal prices of the main agricultural commodities- except for fruit and vegetables- were substantially increased after 1980.

Table 9.4
Changes in cereal and livestock producer prices: (in current dinars)

* The price of sheepmeat was freed in 1979. The calculations given here relate to the period 1975-78 on the one hand and the period 1978-82 on the other.

Cereal prices experienced an average annual increase of 14%, milk prices over 22%. After an annual increase of 16,0% the prices of beef and veal were freed at the end of 1982 and those of sheepmeat were freed at the end of 1979: since then they have risen dramatically.

In recent years, inflation has been higher than in the past: prices of industrial products have increased some 10% per annum and prices of the principal agricultural inputs have also increased substantially. Nevertheless, it emerges that farmers' incomes have improved considerably.

For cereals, on the basis of an identical cost structure and the same yield per hectare by type of holding, calculations show a significant rise between 1979 and 1982-83.28 whether including remuneration of the labour force (treated as income in so far as, for the most part, this labour force is that of the farmer and his family) or treating it simply as a cost.

Table 9.5
Movements in real income (in constant dinars) per hectare of cereal land
(1979= 100)

Dairy farming changed from being an activity that remunerated the work of the farmer and his family at a level even lower than the guaranteed minimum agricultural wage to one that is now a profitable activity. Finally, stock farming constitutes an increasingly significant source of income, especially since the freeing of prices in November 1982.

Table 9.6
Changes in real income from stock farming (in constant 1979 dinars)

^a Income per cow per annum.

^b In integrated stock farming, the farmer produces the grass and hay and purchases the concentrate, in non-integrated farming the farmer produces the grass, but purchases the hay and concentrate,

^c Income per fattened bull calf

Growth of investment in agriculture: During the 1970s, agriculture attracted only 12.5% of total investment. But during the Sixth Plan. 1982-86, this proportion was to be increased to 17.3%: investments were set to rise from 543 million dinars between 1977 and 1981 to 1 420 million dinars between 1982 and 1986. The attention thus given to agriculture was something new: previous plans gave it only 12% to 14% of total investment. To achieve this target, new financial and institutional measures were proposed:

- financially, it was proposed that the state set aside 929 million dinars, 25% of its capital budget, excluding debt, for financing (as against 20% curing the previous plan) and mobilize 178 million dinars in external credits for this sector: it was also proposed that the volume of credits granted by the banking system and the FOSDA should reach 487 million dinars as against only 173 million dinars during the Fifth Plan. ]977-81.

- in terms of institutions, a bank specializing in agricultural financing (Banque Nationale de Développement Agricole National Agricultural Development Bank]) with capital of 40 million dinars was to be created and an Agence de Promotion des Investissements Agricoles [Agricultural Investment Promotion Agency] responsible for identifying projects and aiding agricultural promoters has already started operations.

Determinants of the new agricultural policy

The change in the political orientation towards agriculture is due essentially to the upsurge of world prices for agricultural food products. Until 1978, these were generally lower than domestic prices: including transport costs imported cereals and livestock products were generally 20% cheaper than local products. But, after 1979, the situation was reversed, especially as regards the basic commodity: cereals.

World cereal prices which, despite sometimes large swings, had been slowly increasing up to 1978, began to rise sharply in 1979: by 1981 they were twice the 1978 level. The food deficit, which remained contained within a limit of 50-60 million dinars at most, reached 85 million dinars in 1979, 144 million dinars in 1980 and over 173 million dinars in 1981.

Even from capital's viewpoint, the situation had become alarming and despite the raising of domestic agricultural prices international prices remained very high: encouragement of local agricultural production became vital to avoid a sharp rise in wage costs.

Prospects

The analysis made above reveals how far policy towards the rural areas is dependent on the international situation. Significant measures have, it is true, been taken for agriculture but it is by no means assured that they will be continued and pushed farther. Today, world prices have fallen²⁹ and the domestic economic situation is very tense: the external vice which lay behind the turnaround in agricultural policy is loosening and the pressure of urban actors -workers and the extra-agricultural bourgeoisie - for a larger share of the national income seems to be too strong to allow a real consolidation of the policy of encouraging agriculture.

The institutional and financial reforms contemplated for two or three years are being undertaken slowly and, in some cases,³⁰ farmers' incomes are falling. But even if we suppose that a policy of encouraging agriculture is pursued, the essential question which then arises is: for the benefit of which farmers?

So far, paradoxically, the marginalization of this sector has contributed to maintaining a large peasant population: but will not raising the prices of agricultural commodities and the various measures to encourage agricultural investment lead to an unprecedented deployment of capital - as a social relation -in agriculture and the eviction of the peasantry?

The prospects are not yet clearly defined but the orientations that are gradually becoming clear seem to indicate that the path entered on is not a peasant, but a capitalist path: the volume of credit set aside for small and medium-sized farmers, who represent nine-tenths of the total and account for 80% of production, represents only one-third of the total, and the chief purpose of the established institutions (Banque Agricole and Agence de Promotion des Investissements Agricoles) is to support large farmers.

If this orientation is confirmed, the country's food security might be more or less assured but the problems that will then appear (migration from the rural areas and rapid urban growth) may prove to be uncontrollable.

Notes

1. At least until 1979, as since 1980, the price of cereals, milk and olive oil has been increased while the price of beef and veal and sheepmeat was freed (in 1979 for sheepmeat, in 1982 for beef and veal).

2 Study entitled: 'Prix à la production des céréales et du fourrage dans la Tunisie du Nord', by A. Mabrouk, for Bureau du Plan et du Développement Agricole. Tunis 1975.

3). A 1977 survey of cereal production costs by the Agricultural Statistics Division of the Ministry of Agriculture confirms these conclusions. It shows that the cost of production of a quintal of hard wheat (excluding the profit margin) is seven dinars in the north of Tunisia and 11.3 in the centre and south whereas the net price received by the farmer is 6.5 dinars and the cost of production of a quintal of barley (excluding the profit margin) is eight dinars in the north and 6.6 dinars in the centre and south whereas the net price received by the producer is 4.5 dinars. For soft wheat, the sample survey turned out not to he representative.

4. Coût de production des produits de l'élevage. Office de l'Elevage et des Pâturages, Tunis 1976.

5. In integrated livestock farming, the farmer provides the grass and hay but purchases the concentrate, and the level of production is such that one cow produces 3.01)0 kg per milking: in semi-integrated livestock farming, the farmer provides the grass but purchases the hay and concentrate and the level of production is 2.500 kg per milking.

6. 'Note relative aux problèmes posés au secteur de 1a production laitière'. Office de l'Elevage et des Pâturages, pp. 2-3. Tunis 1974.

7. Ibid.. p. 47.

8. The farmer is increasingly forced to turn to the market because holdings smaller than 10 hectares, which have most of the cattle, cover only 14% of forage areas whereas holdings larger than 50 hectares, which cover only 7% to 9% of the national herd, cover 56% of the forage areas.

9. FAO-SIDA Project. 'Développement de la production de viande bovine dans le Nord de la Tunisie'. Tunis 1976.

10. Coût de production de l'élevage, op, cit.

11. 'Enquête sur les coûts de production des olives à huile pour la campagne 1976-1977'. Ministère de l'Agriculture, Tunis, November 1980.

12. UNA costs and ministry costs compared (adding to these latter a gross margin of 15%) shows that there are virtually no gaps between the two sources:

* Excluding non-mechanized holdings.

The only product whose UNA cost is higher than the Ministry of Agriculture's is oil olive: 119 dinars per metric ton in 1975 as against 118.3 dinars per metric ton in 1977. But this, negligible, gap is more than made up for by the difference in producer prices: in 1975, oil growers were paid by the ONH on the basis of 527 dinars per metric ton, whereas in 1977, they received only 400 dinars (83 millimes per kg of oil olives in 1975 as against 60 millimes in 1977).

13. Unlike other products for which the statistical price series goes hack to 1961 and even earlier the fruit and vegetables price statistical series only goes back to 1965.

14. See 'Rapport préparatoire au VIe Plan 1982-1986: Périmètres irrigués'. Tunisia. Ministère de l'Agriculture`. April 1981. A study carried out by the Centre National des Etudes Agricoles estimates that the real cost of infrastructure within the irrigated public perimeter at 3.500 dinars per hectare for the new Testour Mendjez perimeter. This cost rises to 4.600 dinars if the value of the dam and delivery canal are included.

15. The first law dating from 11 June 1958 concerns the Basse Vallée Medjerda perimeter, the second, dating from 27 May 1963 and amended by the law of 16 February 1971 relates to the other perimeters.

16. See the study by M. Fekih. 'Structures agraires dans la Basse Vallée de la Medjerda'. OMVVM. Tunis 1977.

17. Note relative aux problèmes de l'irrigation dans les périmètres publics irrigués de l'OMVVM, PDI, p. 2.

18. Since the production of the irrigated sub-sector today represents some 25% of total agricultural production.

19. Source for figures: Vle Plan de Développement Économique et Sociale 1982-86, p. 100. Cf, the food deficit in industrial crops and cattle products (meat and milk).

20. For more details see the appendix: food exports and imports.

21. See Structures des exploitation agricoles, Ministère de l'Agriculture, Tunis. December 1981.

22. 'Pressure on the land' would he less pronounced than might appear since in the 0-5 ha hand there are almost 36.000 irrigated holdings.

23. See Structures des exploitation agricoles, op, cit.. p. 62 (for 1961-62), pp. 17ff (for 1977-80).

24. Ibid.. p. 18 (for 1961-62), p. 24 (for 1980).

25. Ibid.. p. 73 (for 1961-62), p. 32 (for 1980).

26. Ibid.

27. Jacques Charmes, 'Evolution des modes de faire valoir et transformation des structures sociales dans la région de l'Anony (Nord Ouest du Lac Alaotra)'. Cahiers ORSTOM. XII, 3. 1975.

28. For 1983, we have used an increase in the official cost of living index of 10%, although we know that during the first quarter of 1983, the index remained below the level reached at the end of 1982.

29. The prices of hard wheat moved from 12.690 in 1981 to 10.612 in 1982, of soft wheat from 9.956 dinars to 9.522 dinars and of barley from 9 ()51 to 7.800 dinars.

30. Thus the price of feed for milch cows was increased by 50% on 22 November 1982 without the milk producer prices being raised. The result was a collapse in farmers' incomes.

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