Business | Markets
Danish firm loses $1.5m per day
Danish dairy firm Arla Foods is losing $1.5 million per day as a result of the regional consumer boycott that has brought its sales to a standstill.
- By Shakir Husain, Staff Reporter
- Published: 23:32 May 3, 2009
Dubai: Danish dairy firm Arla Foods is losing $1.5 million per day as a result of the regional consumer boycott that has brought its sales to a standstill.
"It is a catastrophe for the company. We are not selling anything in the Middle East at the moment," company spokesman Louis Illum Honore told Gulf News at the Gulf Food exhibition in Dubai yesterday.
Consumers in Muslim countries are shunning Danish products in protest against the blasphemous cartoons published by a Danish newspaper. The protests have grown since the cartoons were reprinted in other European countries and Danish prime minister Anders Fogh Rasmussen rejected demands for an apology.
Earlier the Danish pavilion pulled out of Gulf Food, a four-day exhibition that began on Sunday at the Dubai International Convention and Exhibition Centre.
Arla Foods is among 1,800 exhibitors from 80 countries. It decided to remain at the show to meet its business partners in the region to explain its position on the controversy.
Shaikh Hasher Maktoum, Dubai Director of Information, inaugurated the show.
"We still hope that we can continue our business in the Middle East. But in the near future we are afraid the boycott will still be in effect, so we urge the parties who hold the key to the solution to embark on a dialogue to resolve this very unfortunate conflict," Honore said.
"The freedom of speech should not be used to (indulge in) blasphemy," he added.
"It is a complicated issue. As a company we feel we are stuck in the middle. We urge the parties to find a solution," said Arla's regional director Jan Pedersen, who came to Dubai to conduct a damage-control campaign.
"There is no production (at the Saudi plant) at all? We are losing $1.5 million in sales every day," Pedersen said.
The company employs 800 people in Saudi Arabia and 200 in the UAE. It also has business interests in Qatar, Kuwait and Lebanon.
"You can see it is like a football field where elephants are fighting and we are the grass," he said.
Pedersen said Arla has been doing business in the region for more than 25 years and distributors in the region are frustrated over the affair.
"They have warehouses full of products and they have products in the market. Nobody is buying those products," he said, adding if the boycott lasts, "then we'll have to close down our operations in the area."
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