Arabic gum value chain In recent years, the demand for Arabic gum is driven up as result of increasing world consumption of softdrinks and sweets and increasing demand for natural and biological ingredients for among other the pharmaceutical industry. Sudan is world market leader in Arabic gum export but is facing more and more competition from Chad and Nigeria.With the establishment of a processing factory with a spray drying system the project partners will strengthen their competitive edge in the export market. The project will establish a gum preparation factory in the Darfur region and a gum processing factory equipped with dry spraying technology in Khartoum.The applicant, Dar al Turbenat Establishment, is a private company specialised in all aspects of solar and wind power energy based in Saudi Arabia. The first local partner, Abu Wail Engineering, has amongst others a division investing in the financing of trade in seasonal arable crops such as Arabic gum and groundnuts. The second local partner, Al Murah Investment, is specialised in trade and development of a Arabic gum.The three partners will establish a new joint venture.The Darfur region is one of the poorest areas of the world and highly affected by the recent war. As Arabic gum is one of the main sources of income for local farmers investing in specifically this product will have great impact on the livelihood of the local community. The project will establish a Corporate Social Involvement fund at village level for the financing of social services and Arabic gum seeds. By investing in all segments of the production and processing chain the project will also have great impact in Arabic gum production in Sudan. The spray drying system is a proven technology, but is new for Sudan.Corporate Social Responsibility (CSR)The processing method is a proven technology outside Sudan and to a large extent mechanical; risks for pollution with negative impact on health and environment is considered small. Where such risks are identified protective measures will be taken. The project will, for example, train the farmers and supply protective clothing and improved tools for the collection of raw gum from the savannah. During the formulation phase of the project the 'MVO Risk Checker' has been used to carry out to analyse potential risks in the supply chain.Impact•	Employment and working conditionsThe partners in the joint venture will continue to diversify their activities in the joint venture, and invest in trading in sesame, groundnuts, animals (cattle and sheep).A potential obstacle for the collection and trading of crude gum Arabic is the aging farming population as young famers move to urban centres, as the collection of gum is not attractive to new generations. Therefore, the joint venture will continue the policy to support livelihood development for the local population by paying competitive prices for the crude gum, and investing in social services such as, education, health, water and electricity (solar power). Presently, farmers are scattered around the rural areas, and with investment in social services, the project intends to contribute to the development of small rural centres, which will be attractive for young farmers and their families, who can continue working in the gum Arabic sector.The joint venture plans to establish five plantations of gum Arabic trees by planting trees in the existing savannah (no mono-culture). Each plantation will be 2,100 ha (5,000 feddan), which will provide a good basis for sustainable gum production. Sustainable production will enable the company to stabilise prices and maintain stocks. It is expected that with the expansion of the production base the capacity of the two factories will need to be doubled in terms of output and personnel. It is expected that each plantation will yield at least 300 tons of crude gum Arabic for further processing into the various grades.After the project, the joint venture will expand to the regions of Kordofan and Blue Nile. The lessons learnt in Darfur will be used for the expansion of the operations of the joint venture.•	Innovation / Transfer of knowledgeTechnical innovationThe joint venture will introduce processing technology which is innovative for the gum Arabic industry in Sudan. The project will establish a spray drying processing plant capable of refining raw gum Arabic into powder and granules for export as well as the local market.Social innovationAlthough donors (FAO) have implemented gum Arabic development projects in Sudan, this has not yet been done in a commercial environment. The project will engage directly with farmers’ communities in Dar Fur and introduce improved harvesting methodologies, provide selected seeds for plantations, and introduce improved handling and cleaning methods, this in combination with investments in community development (social services). This can be considered an innovative approach in an area, which has been and still is characterised by insecurity and conflict.•	Chain effectsAt the level of the production, the number of farmers delivering gum Arabic to the project will increase from 1,500 in 2014 to 4,500 in 2018. The total yield of crude gum Arabic will vary from year to year due to climate fluctuations in temperature and rainfall, but is estimated at 1,400 tons in the beginning of the project to 4,050 tons at the end of the project. The producers will be trained various aspects of gum production: quality control, proper tapping of the Acacia trees, introduction of new tools, use of plastic sheets under the Acacia tree during tapping to prevent contamination, use of plastic gloves, and provision of jute bags for 10 kg of crude gum for transportation to the factory. Protective clothes will be provided to the farmers at a reduced cost. The payment to the farmers for the crude gum will be in cash, which is in sharp contrast with the present system of payment in kind which is presently practised by most traders (middlemen). Farmers prefer payment in cash. Prices will be discussed and agreed upon in discussions with representatives of farmers’ groups (associations).Introduction of proper tree husbandry and the planting of trees with proper spacing will contribute to the restoration of soil fertility in the fallow system. This will allow a more successful crop after the productive life of the gum trees. Production levels of sesame, groundnuts, millet and sorghum will be higher, benefitting the local farmers. Gum trees are productive between 3 and 20 years. If properly managed the trees can be used for construction, firewood and charcoal. The benefits of the planting and proper management of gum Arabic trees can be summarised as follows:Direct benefitsAcacia Senegal trees’ leafs and pods are used as fodder for cattle, sheep and camels. Older trees are often cut for fuel wood. Arabic gum trees are suitable in the bush-fallow and intercropping system prevalent in the project area. Older trees are used for charcoal production. Gum Arabic trees are used for construction.Indirect benefits-	Gum Arabic trees’ deep tap root and extensive lateral root system reduces.-	Soil erosion.-	Gum Arabic trees serve as wind breaks.-	Acacia Senegal fixes nitrogen in the soil.-	The gum Arabic belt acts as a buffer against desertification.About 2% of the gum is consumed on the local market, but an increase in local demand is expected, especially for the high grade spray dried product, which presently mostly imported. With the spray dry processing plant in operation it is expected that the dependency of Sudan on imported spray dry gum can be reduced and foreign exchange saved.•	Impact on the sectorThe joint venture will be an active member of both the international Gum Arabic Association (France) and the national Gum Arabic Council, a government body where information on marketing policies and prospects is exchanged. All stakeholders participate, such as exporters, importers, producers, and processors.Technical know-how and experience is shared with the University of Khartoum (Chemistry Department) and the Gum Arabic Research Centre of the University of Kordofan, which will also provide consultancy services to the project. The project will organise a seminar for all stakeholders of the sector to present the achievements and challenges of the new spray dry technology and disseminate information. The project has the ambition to be an example to other actors and stakeholders in the gum Arabic sector, aiming at improving industrial and employment standards in the chain.The project will cooperate with a quality control laboratory in Sudan to meet the requirements for international certification.•	EnvironmentDue to re-occurring droughts in the project area in the past years resulting from climate change, the agro-forestry system has undergone substantial deterioration.Tree mortality has been high and the bush fallow system which provides the livelihood of the local population is threatened. The project is aiming to contribute to reverse this trend by introducing improved gum tree husbandry methods and the establishment of new plantations with selected seeds. The improved bush fallow system will contribute to the restoration of soil fertility through fixation of nitrogen by the gum Arabic of the Leguminosae family. Soil and wind erosion will be reduced by the wind break effects of the trees and the protection against soil erosion.After the fallow period of 15 to 20 years the Acasia trees can be cut and replaced by new trees. In this period other dry-land crops such as sesame, groundnut, sorghum and millet can be planted which will benefit from the restored fertility levels in the soil. In this way proper land management will contribute to food security. Improved production of gum Arabic and food crops will have beneficial effects on rural family income and improved livelihood. It is not possible to quantify these effects.The gum Arabic belt acts as a buffer against desertification.•	Position of womenThe project will employ about 250 seasonal female workers. Working conditions (salary, health, etc) will be competitive with other sectors; the wages will be 10% above minimum (government) wages. The workers will be encouraged to form a union, representing the workers.•	Impact on waterGum Arabic trees deep tap root and extensive lateral root system reduces soil erosion. Gum Arabic trees serve as windbreaks. Acacia Senegal fixes nitrogen in the soil. The Gum Arabic belt acts as a buffer against desertification. To establish a gum preparation factory in the Darfur region, where 250 local seasonal workers will be employed and to establish a gum processing factory for the production of high grade spray dried gum with a capacity of 750 kg per hour.