>Israelis teach Vietnam how to milk it

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Israelis teach Vietnam how to milk it

By Ben Bland
Published: March 17 2011 21:27 | Last updated: March 17 2011 21:27
TH Dairy
On a remote farm in rural Vietnam, some 20 or so Israeli kibbutzniks are having to plan ahead for Passover even though it is not for another month.
Their early preparations for the Jewish festival have less to do with spiritual fervour than their location. For they have upped sticks from their homes in the Jordan Valley to move to Nghe An province in north-central Vietnam, where they are helping to build and operate one of Asia’s biggest dairy farms.
It is not easy to get unleavened bread and other traditional Passover fare in these parts. But it is important to keep up morale among the Israelis in their “expat village”, says Barak Wittert, the farm’s director.
Mr Wittert, who grew up on an Israeli kibbutz, has helped set up high-tech dairy farms in the developing world, from Africa to the Middle East. But the TH Milk farm, backed by Thai Huong, a well-known Vietnamese businesswoman, is the most ambitious project he has seen.
The plan, devised by Ms Huong, who runs a local bank, and executed by the Israelis, is to build a huge, state-of-the-art dairy farm and transform the small but fast-growing fresh milk industry in Vietnam.

Audio slideshow: Vietnam’s mega-farm

Audio slideshow: Vietnam's mega-farm

Ben Bland visits a milk farm in Vietnam that is one of Asia’s biggest, with capacity for more than 100,000 cows
Since construction began in October 2009, 12,000 cows have arrived from New Zealand and nearly 300 workers have been hired.
The first milk cartons appeared on store shelves in December 2010 and more than 2,000 cows are now milked daily.
“This is the first time I’ve seen so much achieved in such little time,” says Gil Inbar, chief executive of TH Milk and a veteran of dairy projects in Africa, India, Turkey and Ukraine.
The aim is to expand to 137,000 cows by 2020 after a total investment of more than $1bn.
Mr Inbar concedes that there were “cultural conflicts” initially, as most of the Vietnamese workers were new to dairy farming and unused to operating such high-tech systems. “But sometimes it’s easier to take on people with no prior experience as they have no bad habits,” he says.
Mr Inbar and Mr Wittert work for TH Milk, the Vietnamese company that controls the project. But the farm is being set up and operated by Afimilk, a dairy farm technology company owned by Kibbutz Afikim.
Like many of Israel’s collective farms, Afikim abandoned its socialist ideals in the 1980s for more capitalist activities. Vietnam’s communist leaders, who started opening their country at around the same time, have followed a similar path.
This shared heritage has helped the Israelis to hit the ground running, according to Rami Ofer, Afimilk’s project manager in Vietnam. “There is some advantage for people who come from a socialist background to understand the environment in Vietnam,” he says.
To keep costs down, the Israelis are training Vietnamese dairy farmers and handing over as much responsibility as soon as possible.
The plan is to turn the farms over to the locals within five years.
The pace of progress is all the more impressive in a country where big projects are often delayed by corruption, red tape, financing problems and extreme caution in local government. Senior staff say the initial success is largely down to Ms Huong, whom they describe as an exacting taskmaster.
“It’s not easy to get land and financing in Vietnam, but fortunately we have a very strong chairwoman to bring us everything we need,” says Mr Inbar.
Ms Huong is general director of North Asia Bank, which is financing the project, along with other unnamed investors.
As well as profits, she says the project will bring wider benefits. “Milk is an essential need for the human development of Vietnam,” she says.

Nghe An, birthplace of Ho Chi Minh, Vietnam’s late revolutionary leader, will get some much needed investment, jobs and infrastructure in the area near the farm. Indeed, Ms Huong is already thinking ahead to how she can promote further large-scale industrialisation in agriculture. “You must complete your strategic thinking first in order to develop a project quickly,” she says. “But the critical factor in the success of this project has been the Israeli experts guiding the Vietnamese.”

FT.com / Management – Israelis teach Vietnam how to milk it

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