Wednesday, March 19, 2008

Nestlé in Sri Lanka - baby food regulations and the dairy industry

The Nestlé 'Shared Value' report says on page 55: "Results of the most
recent of these external audits, carried out in Sri Lanka, can be accessed from"

But visit that website and there is no sign of this audit. The most recent 'Action Report' is June 2003! I have documented here before how these reports, which were supposed to be monthly, became a channel through which Nestlé had to admit to breaking the marketing code for baby foods and apologise for misrepresenting comments from others. Baby Milk Action gained a full-page right to reply in one issue. See:

The latest news blurb highlighted on the home page is from 24 July 2007.

So why is the audit not really there?

It could be because Nestlé does not wish to expose it to scrutiny. Baby Milk Action has campaigned about Nestlé malpractice in Sri Lanka in the past. When new regulations were being introduced ten years ago, Nestlé lobbied against provisions implementing the International Code of Marketing of Breastmilk Substitutes. See:

Any improvements in marketing practices in Sri Lanka are despite Nestlé's best efforts to undermine the regulations, not because of any willingness to comply.

Also in Sri Lanka, we have examined the impact of Nestlé and other multinational companies on the dairy industry, which has seen small-scale farmers lose their livelihoods and the price of milk to the public soar.

There is an article in the Sri Lankan newspaper, The Daily Mirror, today recalling the role of the International Baby Food Action Network (IBFAN) in achieving stronger regulations.

The article also addresses the destruction of the indigenous dairy industry, though it does not mention Nestlé by name. Here is an extract:

---Daily Mirror extract
Handing over the domestic dairy development to a transnational company was similar to handing over a flock of lambs to a wolf for protection. Today the destruction of the domestic milk production is complete and is replaced by a monopoly over the milk market which is controlled by a few milk companies. The prices are dictated by the industry. As a direct result almost half the children, under five, are acutely malnourished and wasted, and 40 percent of pregnant women are anaemic. The Asian Human Rights Commission has recorded the price of a 400 gm packet of Milk Powder as Rs 6.00 in 1977, Rs 50.00 in 1994, Rs 100.00 in 2001, Rs 195 in October 2007 and today it is Rs 275. The Consumer Affairs Authority seems to have no way of controlling the rapidly increasing milk prices.
---extract ends

I interviewed a Sri Lanakan campaigner about this in 2002 to find out about Nestlé's impact in the country after a debate in the UK with Nestlé's Beverley Mirando, who is from Sri Lanka, and claimed people in the country welcome Nestlé's impact. I knew there had been demonstrations against the company on the milk issue and wanted to hear direct from people there. You can listen to the interview at:

So while Mr. Brabeck, Nestlé Chief Executive, tours with the 'Shared Value' report boasting that Nestlé benefits millions of people, it seems that people on the ground have a different view. Perhaps this is why the Sri Lanka audit is not yet available on the Nestlé website.

Nestlé's impact on the dairy industry in Sri Lanka is a recurring story. I have documented similar concerns about market domination followed by price hikes elsewhere. See:

By coincidence, China Knowledge is reporting today: "Nestle to raise milk powder prices up to 30% in China".

No comments: