Nestle suspends operations in Zimbabwe for political reasons
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Nestle Zimbabwe, the Switzerland- headquartered food company, has temporarily ceased operations in the country for political reasons.
The move came after it bowed to pressure from activists that are against Zimbabwe's land reform program to stop buying milk from Gushungo Dairy Estate, which is owned by the First Family and seven other farms in October, according to reports by The Herald on Wednesday.
That decision was strongly criticized by local indigenous pressure groups, especially the Affirmative Action Group, which said the move was tantamount to the company imposing sanctions on the country.
A spokesperson for the company in Kenya on Tuesday confirmed the closure of the company without giving reasons. "Nestle Zimbabwe has temporarily decided to shut down its factory," said Brinda Chiniah.
On Monday, Zimbabwe's Youth Development, Indigenisation and Empowerment Minister Saviour Kasukuwere said there was a new strategy of using local companies with foreign shareholders to impose sanctions on the country. He gave Nestle as an example of such companies.
Kasukuwere warned companies that are pursuing that agenda that the Zimbabwean government would not hesitate to bring them under local control to ease their burden of having to report to foreign shareholders.
He said these companies were importing raw materials that were available locally and in doing so thwarting efforts to create jobs in Zimbabwe.
"They are ignoring local producers. If they don't want to support local producers, tough luck to them," said Kasukuwere.
Nestle was importing its raw materials from countries such as Thailand and was simply doing toll manufacturing in Zimbabwe. The company initially resisted pressure from the West to stop its dealings with the First Family, but later gave in.
It had also argued that its decision to remain in the country was solely based on the need to preserve jobs for its workers and ensure the availability of its products to the Zimbabwe market.
