Adding value to Vietnamese Pomelo: Creating superior export quality and innovative fresh-cut Partners will establish the first professionally managed fruit chain for pomelos in Vietnam including a state-of-the-art fruit warehousing model and farmer contract system. The project is situated in the Mekong Delta, southern Vietnam. The business concept benefits from the ability of Vietnam to produce the pomelos year-round and so a unique window of opportunity for pomelo exports exists in the period from February until the end of August when the largest exporter (China) has much less pomelos available and prices increase with about 40%.An innovative fruit farmer extension and contract system will be set up which will train pomelo farmers to grow pomelos in a sustainable manner (and of better quality) and which shall offer them a contract that guarantees the sales to the joint venture of their total harvest at a fair price.In the warehouse pomelos will be classified (4 grades) and the best fruit (grade 1 and 2) will be exported. Fruit which does not meet the export quality requirements shall be processed into fresh-cut fruit (the pomelo cleaned, peeled and divided in pieces) or will be sold on the local fruit markets.Some of the employment impact in figures:• At the end of the project (December 2012) 100 direct permanent jobs in the fruit warehouse and in the pomelo sourcing system will have been created and additionally 50 seasonal jobs.• Long-term contracts will be made with 100 pomelo farmers and short term supply contracts with 150 pomelo farmers by 2012.• 100 pomelo contract farmers will be trained in GlobalGAP, of which 75 pomelo contract farmers will be GlobalGAP certified by the end of 2012.Corporate Social Responsibility (CSR)The proposed joint venture will apply a sound and fair policy for social standards for its personnel and staff in full compliance with the Ethical Trade Initiative standard.(Note: Almost all ETI members are British firms, among which a large number of British supermarket chains. As Britain is the largest fresh cut fruit market in Europe, it will be a future important marketing tool to become ETI compliant).But, TFR intends to go further than ETI because their wages will be 15% higher than the official minimum wage as set in the Vietnamese labour law of 2010. Also, TFR will introduce a package of fringe benefits for their staff and provide support for medical insurance and care, opportunities for job improvement and training as well as meals. The factory will meet all requirements for safety, personal hygiene, religious practices and privacy for its personnel.The company will be certified HACCP which involves good waste management practice and energy use.As part of the GlobalGAP certification, contract farmers will be trained and assisted to meet the GlobalGAP requirements of which the workers’ health, safety and welfare is an important aspect.And in addition, the contract farmers will be offered training on integrated pest management, first aid, safety and food hygiene TFR has declared to refrain from activities related to any form of: child labour, corruption, gender or religious discrimination, environmental harm and other irresponsible practices.Impact•	Employment and working conditionsThe project will employ 100 people, of which the majority will be female (55). The management team will consist out of 5 managers, to whom 6 medium-level management staff (with management functions) report. Below the medium-level management staff, come the regular staff and workers.Two years after finalisation the project is expected to employ 200 basic-level staff and 40 medium-/high-level staff. 60% of the workers will be female.For the workers special salary scales for the more skilful and highly motivate have been made, in order to also offer workers career opportunities.Between the workers and the medium-level management staff, there are additional career opportunities for those workers with management talents to become a team leader of a group of workers.•	Innovation / Transfer of knowledgeA professionally managed fruit farmer contracting system with a private funded extension team and a fruit warehouse with a fresh-cut fruit facility can be considered innovative for the Vietnamese fruit sector in the Mekong Delta.The TFR extension team will become experts in GlobalGAP, obtain improved skills in training farmers and through a more participatory approach in extension also develop continuous improvements with farmers in the pomelo production systems. Important are also the transfer of skills in fruit warehouse management and software support. HACCP certification in agriculture processing is not an innovation for Vietnam, as this is common practice in the catfish export industry in the Mekong Delta, but so far this has not been applied to fresh-cut fruits.•	Chain effectsMainly benefits for the pomelo farmers and labourers:Long-term contracts to buy their all their fruits year-round in large volumes: Farmers can choose if they receive one fixed price for all fruit classes or an incentive system where there will receive different prices for different grades.Farmers can benefit from the extension services, which will increase the percentage of class one fruits, their yields and most importantly their profitability. By the end of the project in 2012, it is expected that as a spin-off about 655 additional farm labour positions will be created, which will increase by 2015 to around 2,300.Besides the people with land (farmers), also the people without land can benefit because of the large number of jobs which will be created, especially by the work for the fresh-cut pomelo.•	EnvironmentPositive: mainly because of a reduction in the use of pesticides (a large number of which now are forbidden pesticides) and thus less amounts of toxic pesticides will end up in both surface water, ground water, soil and as pesticide residues on plants. This decreased environmental pollution will be a very important achievement of the project and serves the public good. Less pollution results in a decrease in occupational health, a healthier product for consumers and a better reputation on the international market. In order to minimise the carbon foot print, the fruit warehouse will be built in such a way that the electricity use will be as low as possible.•	Position of womenThis project is expected to create significant employment for women in especially management, administration and the production of fresh cut pomelo. The TFR management team is expected to select more women for the positions in the company then men. Very often in Vietnam, only the men will take part in the training, while their wives stay on the farm. To deal with this undesired situation, considerable efforts will be undertaken to involve the women as much as the men in the farmer training programmes. To set up a GlobalGAP certified pomelo fruit chain of 100 contract farmers and a state-of-the-art fruit warehouse including a fresh-cut room for processing pomelos.