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Uproar follows Nestlé's milk deal with the Mugabes

By Miriam Mannak     Sep 29, 2009 in World
South Africans have reacted in furor after media reported that Nestlé is buying milk from dairy farms that were seized from white farmers between 2002 and 2004 and are now owned by president Robert Mugabe and his wife Grace.
Radio station Talk Radio 702 has said that dozens of people called in and sent sms's, urging for a national boycott of the Swiss company.
People are also calling for a boycott on social websites like Facebook: "No more Nestlé in my house," a young woman from Cape Town said in her status. "Everyone please boycott Nestlé for doing business with a dictator," someone else said. In the meantime, a 'boycott' group has been established urging people to scrap Nestlé products from their shopping lists
The uproar comes after various newspapers including The Star, one of the South African dailies, ran a story claiming that the Swiss food giant is purchasing 1 million liters of milk a year from The Gushungo Dairy Estate, a dairy farm that was seized from its owner in 2003 and is now controlled by Zimbabwe's first lady.
The story said that apart from the Gushungo Dairy Estate, situated 50 km north of Zimbabwe's capital of Harare, the Mugabes have helped themselves to five or six of the most valuable of the hundreds of white farms that were taken away from their owners by the ZANU-PF government.
In 2002 and 2003, the EU and the US, in protest of the land seizures, imposed trade sanctions on Zimbabwe, prohibiting European and American companies to do business with anyone and any company linked to Mugabe. This black list comprises of 200 individuals and 40-odd companies with ties to the ZANU-PF regime.
Media have wrongfully reported that Nestlé is not bound by these sanctions because Switzerland, where it has its global head quarters, is not part of the EU. Swiss legislation on international sanctions, including the sanctions against Zimbabwe, deploys its effects only in the territory of Switzerland.
"Foreign subsidiaries of Swiss companies are not subject to the Swiss legislation. The dealings of Nestlé Zimbabwe (Private) Ltd are therefore not in violation of the Swiss sanctions regulation against Zimbabwe,” said a spokesperson of the Swiss finance minister.
In a press statement, Nestlé motivated its decision to trade with the Mugabes: "During the last few years Nestlé has witnessed the collapse of Zimbabwe’s dairy industry. Nestlé prefers to work within contractual agreements to ensure a constant supply of fresh milk, but at the end of 2008, the company found itself operating in a market where 8 of its 16 contractual suppliers had gone out of business. As a result, in early 2009, Nestlé was forced to purchase milk on the open market from a wide variety of suppliers on a non-contractual basis. This includes milk from the Gushungo Dairy Estate which today accounts for between 10 percent and 15 percent of Nestlé's local milk supply."
Nestlé furthermore justifies its decision to trade with one of Africa's most notorious heads of state, as it wants to safeguard the well-being of Zimbabwe's people: " By providing basic food products to Zimbabwean consumers, Nestlé aims to meet the needs of the local population, many of whom are vulnerable and disadvantaged. Had Nestlé decided to close down its operations in Zimbabwe, the company would have triggered further food shortages and hundreds of job losses among its employees and milk suppliers in an already very difficult situation."
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