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SRI LANKA: Milk Prices and War An Issue of Fair Trade and Human Rights

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

The Right of Mothers to Feed Their Hungry Children in Sri Lanka

In the last three months, the price of all milk and milk foods has increased to really unbearable levels. The price of a 400-gram packet of milk powder in 1977, for instance, was about 6 rupees (US.07 [all figures are based on June 2001 exchange rates]). It had increased to about 50 rupees (US.56) by 1994. 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, this packet of milk has now increased to 100 rupees (US.11).

Sri Lanka, just two decades ago, was a country in which 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, we do not have any 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 US3 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 percent). Thus, the government has allowed the companies to increase their prices as they wish. This was done earlier as well to increase government 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.

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 and that full cream milk was essential for the nutrition of children. This milk costs 119 rupees (US.33) for 400 grams.

Not Only Unfair,
but Criminal

This trade is not only unfair but is totally criminal in the Sri Lankan context of poverty, hunger, malnutrition and anaemia suffered particularly by mothers and children in all parts of the country.

According to the figures of the official poverty alleviation programme, Samurdhi, half of the population in the country, or two million families, receive less than 750 rupees per month in family income. The World Bank standard for poverty is less than US per day per person. The above income is about US per family per month.

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 at exorbitant prices is available in the country-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.25) per month for the child's milk alone.

Therefore, we now have about half the population of the country unable to feed their children with their essential milk requirements, even if they spend their entire family income on this alone without any food or additional expenditure for any other essential need. We are sure that you will not believe these figures. Neither do we believe them. In fact, we simply refuse to believe and accept these figures, but these are all figures provided by official sources. These are figures that the IMF and World Bank wants us to accept as realities. These are figures that they have created for us.

We get really angry when they tell us that this is part of their "new approach to poverty reduction." We get angry and hate the governments that we have elected when they tell us that the World Bank and IMF did not "twist their arm" to get them to introduce these measures.

We would like to invite you to begin to refuse to accept these as measures to alleviate poverty and to help us to achieve poverty-reducing growth.

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 most criminal 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 are also being spent to build more infrastructure for the richest investors in the world. The budget this year includes building four super-highways at a cost of approximately 7 billion rupees (US.95 million). The IMF has told the government that these capital expenses should be continued at any cost.

We will fight back though. It is a "holy struggle" that is necessary just to survive.

Posted on 2001-07-09
     
 
Asian Human Rights Commission

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