Agricultural sector must pay attention to Turkey and Egypt

Forget the issues of the day and look to the future, because what awaits us? Recently I saw some remarkable future figures published by the multinational banking group Standard Chartered. These included the state of affairs of the global economy in 2030.

Standard Chartered calculated, among other things, which countries are currently the largest growers. "The absolute superpower is China," the bank said. Not surprisingly, my fascination grew with the claim that in 2030 also India the United States will have passed. The group assumes a combination of purchasing power parities and the estimated nominal gross domestic product. It reflects that Asia will be the most dominant economic region of the planet by 2030: 7 of the 10 largest economies will be Asian by then.

Emerging Markets
However, as far as I'm concerned, the most interesting is yet to come. For example, Standard Chartered states that today's emerging markets are the 'powerhouses of tomorrow'. Next comes a top 10 of the largest economies. With Turkey in fifth place and Egypt in seventh place. Germany is in tenth place in this list.

In fact, all positions are remarkable. For example, Japan falls from fourth to ninth place and Germany drops from place 5 to place 10. In contrast, Egypt shows a gigantic jump: from place 21 to place 7. Where does this gigantic growth come from? As an explanation, the banking group links the Egyptian population growth to the rapidly rising level of prosperity.

Egypt is growing fast
According to a study by Standard Chartered, Egypt will have more than 2030 million inhabitants in 128, an increase of 30% compared to today. I immediately think: 128 million mouths that need to be fed. Can't our agricultural sector also benefit from this?

Take the potato sector, for example. Egypt is currently the second largest buyer of Dutch seed potatoes (outside the European Union). It is even expected that Egypt will become the number 1 importer of our seed potatoes. Egyptians are also fond of our processed potato products, such as French fries. Just look at it Farm frits: they want to double their production capacity in Egypt.

And what about Turkey?
Turkey is also showing an insane increase. Trade between the Netherlands and Turkey is already on the rise: despite the significant depreciation of the lira, in 2017 Turkey was one of the top 10 fastest-growing major export destinations for Dutch companies, according to figures from the Central Bureau of Statistics ( CBS). 

Turkey also has a lot to offer in the agricultural field. For example, the country is strong in the production of melons, strawberries, leeks, honey, lentils and bell peppers. According to the chairman of the Turkish Chambers of Agriculture, Turkey is in the top 55 of largest producers for 10 agricultural products.

Grab a grain
Based on the growth that Standard Chartered is promising, the Dutch agri and food sector should therefore be able to benefit from the enormous economic advance that is about to break out in both Egypt and Turkey.  

Johan Geroms

Johan Geeroms is Risk Director at Euler Hermes, the world market leader in credit insurance and corporate debt collection. In his blogs, Geeroms often focuses on developments in the agricultural sector.

© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.