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This paper analyses the agricultural and rural capital factor markets in the three European Union (EU) candidate countries: Turkey, Croatia and the Former Yugoslav Republic (FYR) of Macedonia. Agricultural and rural capital markets share similarities with the general capital market developments, but agricultural and rural capital markets are facing specific credit constraints related to agricultural assets and rural fixed asset specificities, which constrain their mortgages and collateral use. Credit constraints form a limited access to the investment credits necessary for the restructuring of small-scale individual farms. Government transfers are used to differing extents in the different candidate countries, but generally they tend to increase over time. Remittances and donor funds have also played an important role in the agricultural and rural economy investments.

Agricultural and rural capital markets in Turkey, Croatia and the FYR of Macedonia