SRI LANKA: Nestle, Anchor, Govt, IMF denying food to infants


Urgent Appeal Case: UA-26-2001
ISSUES: Right to food,

UA-26-2001 – Nestle, Anchor, Govt, IMF denying food to infants 

SRI LANKA: Right of Mothers to Feed their Hungry Children 

The latest UPDATE for this appeal is available at: 

The following appeal is to protest the increase in the price of milk products in Sri Lanka. This is a serious human rights concern about one of the most basic of all rights – the right to food. 

In the last four months, the prices of all milk and milk products in Sri Lanka have increased to unbearable levels. The price of a 400 gram packet of milk powder in 1977, for instance, was about 6 rupees (US$0.07 [all figures are based on June 2001 exchange rates]). By 1994, it had increased to about 50 rupees (US$0.56). This was when the government changed hands, and the People’s Alliance (PA) government that came to power was loudly deploring the fact that 60 percent of the children below 5 years of age were malnourished. They promised that they would improve the situation. However, after six years of the same policies under the PA, the price of this same packet of milk has now increased to 100 rupees (US$1.11). Nestle recently introduced a new variety of full cream milk named “NIDO”, saying that they were doing this since there was no longer any fresh, full cream milk available in Sri Lanka (thanks to Nestle and others) and that full cream milk was essential for the nutrition of children. This milk costs 119 rupees (US$1.33) per 400 grams. 

This trade is not only unfair but is totally criminal in the Sri Lankan context of poverty, hunger, and malnutrition suffered particularly by mothers and children in all parts of the country. According to figures of the official Poverty Alleviation Programme (“Samurdhi”), half the population in the country, or two million families, receive less than 1,000 rupees (US$10) per month in family income. The World Bank standard for poverty is less than US$1 per day per person. In such a situation, a family with just one child below 5 years of age, who requires essentially to be fed with milk (only powdered milk is available, thanks to Nestle and others), will have to be provided with at least 10 packets a month. Such a family will have to spend 1,190 rupees (US$13.25) per month for the child’s milk alone. Therefore, about half the population of the country is unable to feed their children with their essential milk requirements, even if they spend their entire family income on this alone. What about their essential food, medicinal and other requirements? 


Just two decades ago, Sri Lanka was a country where fresh milk was freely available and very cheap. In 1981, under the policy of liberalisation and privatisation, the government took a decision to close the National Milk Board and signed an agreement with Nestle to develop the dairy industry. After 20 years, there is no fresh milk available in the market, and the entire milk foods sector is in the hands of just two or three large companies, such as Nestle, Anchor and Maliban, which market only milk powders imported from the West. 

In April 2001, the government was given a standby loan of US$253 million by the International Monetary Fund (IMF) on the understanding that the government would introduce immediate tax increases, deregulate the rupee and take other measures to reduce government expenses and increase revenue. The government as a result has decided to raise greater tax revenues from the milk companies (presently the tax on milk powder sales is 19.5%). Thus, the government has allowed the companies to increase their prices as they wish. The government previously raised income by increasing taxes on tobacco and alcohol, but now they have begun to implement the same revenue-generating policies with milk, including infant milk – a very different commodity. 

Already, about half the population of mothers, and children of age groups 5-11 years and 11-18 years, have been found to be anaemic according to the latest figures available (last survey in 1994). The impact of these price increases would be unimaginably destructive and criminal. 

The injustice of this situation goes far beyond what has just been described since the money that is extracted from the country’s starving mothers and hungry children will be spent for the process of killing, for the continuation of the war. It makes the situation even more tragic since the money earned by government taxes of this type is also being spent to build more infrastructure for wealthy global investors. The budget this year includes building four superhighways at a cost of approximately 7 billion rupees (US$77.95 million). The IMF has told the government that these capital expenses should be continued at any cost. 

The government of Sri Lanka’s conduct on the issue of milk is a violation of human rights. Sri Lanka has undertaken to respect, protect and fulfill the right to food by ratifying the International Covenant on Economic, Social and Cultural Rights. In 1999, the UN Committee on Economic, Social and Cultural rights adopted General Comment No.12 on the human right to adequate food, which defined the right to food as including, among other things, two key elements: (1) that food is ‘sufficient for the dietary needs’ of the people (2) that the food is ‘accessible’. ‘Accessible’ is primarily defined as including a purchase price that does not prevent the satisfaction of other basic needs. The Committee states that “Violations of the Covenant occur when a State fails to ensure the satisfaction of, at the very least, the minimum essential level required to be free from hunger.” (para.17). 

The Sri Lankan government has not lived up to its obligation to respect, protect and fulfil the human right to adequate food. First, by adding a heavy defence levy and GST, the government actively interferes with access to milk. It starves the poor to feed its war. Second, by initially granting virtual monopoly status to companies such as Nestle, Anchor, Lanka milk foods Ltd and Maliban, the government fails to ensure an affordable price for the nation’s poorest people. It thus fails to protect the human rights of the Sri Lankan people from the profit-motivated practices of private actors. Finally, by failing to adopt a plan of action to ensure that the nation’s most vulnerable groups have, as a very minimum, the bare essential nutrition for a moderately healthy existence, the government fails to implement its obligation to fulfil the right to food. 

[Information provided by Seelawathie Menike of the Movement of Mothers to Combat Malnutrition (MMCM) and Sarath Fernando of the Movement for National Land and Agricultural Reform (MONLAR)] 


Express your concern by writing a letter to: 
(1) The President of Sri Lanka: 
– Demanding that priority be given to food, rather than the war and highways, in spending the national budget; 
– Demanding measures to improve the nutritional status of pregnant and breast feeding mothers and of children; 
– Pushing for the formulation of a national policy of rebuilding domestic milk production by the small rural farmers; 
– Calling for an end to the commercial advertising of Milk foods (which could reduce the prices of all milk powders by half); 
– Demanding the removal of tax on milk products and the reduction of prices by an equivalent amount (a further reduction by 19.5 %); and 
– Calling for government intervention to break the existing monopoly of importing and marketing of milk (a further reduction of milk prices would be possible). 
(2) Nestle and Anchor 
– Protesting their role in the destruction of domestic milk production by small rural farmers; and 
– Demanding a reduction in the price of their milk products. 
(3) The IMF 
– Protesting its role in compelling the Sri Lankan government to increase the cost of living to unbearable levels, increase taxes, and reduce government expenditure on basic services, including services provided by the health, agriculture, dairy and veterinary sectors. 


Your Excellency 

I am horrified at the situation concerning milk prices in Sri Lanka. I find it hard to accept the reality that two million families (half the population!) in your country cannot buy the required quantity of milk powder for a little baby, even if they spent their entire monthly earnings on milk alone. The Sri Lankan government must take measures to ensure that children are not deprived of this basic food. 

I am also disgusted by the role that big milk companies such as Nestle and Anchor have played in this. With the assistance of the Sri Lankan government, they have caused the destruction of domestic milk production in order to create a monopoly over the milk market. Those who suffer in this game are the children that they purport to provide services for. The government has the responsibility to intervene to prevent this exploitation, regardless of pressure from the IMF or the companies. Assurance of life and health for infants must be the first priority for any humane society. 

I implore the government of Sri Lanka to take action to reduce milk prices immediately. It is imperative that the government take steps to rebuild domestic milk production in Sri Lanka, in order to become less reliant on companies such as Nestle and Anchor. It is time to break the monopoly. Please stop depriving Sri Lanka’s children of their right to food! 

Yours Sincerely, 


Her Excellency President Chandrika B. Kumaratunga 
Presidential Residence 
Colombo 3 
FAX: +(941) 333 703 
SALUTATION: Your Excellency 

Mr. Peter Brabeck 
Av. Nestl?55 
1800 Vevey 
Fax: 0041 21 922 6334 

New Zealand Milk Products Lanka (Pvt) Ltd (Anchor) 
100 New Kandy Road 
Tel: 94 1 570 032 
Fax: 94 1 570 017 
General Fax: 94 1 570 261 

International Monetary Fund 
700 19th Street, N.W., 
Washington, D.C. 20431 
Telephone Operator: (202) 623-7000 
Fax: (202) 623-4661 
General Email: 

You are also strongly recommended to send the appeal, by email or fax, to Sri Lanka’s diplomatic representatives in your country, requesting them to forward your complaint to the relevant Sri Lankan authorities in Sri Lanka. 

Document Type : Urgent Appeal Case
Document ID : UA-26-2001
Countries : Sri Lanka,
Issues : Right to food,