http://europe.cnn.com/2002/BUSINESS/12/23/nestle/

Nestle plans donation to Ethiopia

                      Monday, December 23, 2002 Posted: 1552 GMT

                      VEVEY, Switzerland (CNN) --
                      Nestle, the world's biggest food
                      producer, plans to give any
                      money it receives from a
                      damages claim against Ethiopia
                      back to the poverty-stricken
                      country.

                      Chief Executive Peter Brabeck said the
                      company was not interested in taking
                      money from Ethiopia while it faced famine,
                      so it would donate any proceeds to food
                      aid for the country.

                      But he said on Monday that Africa would
                      benefit in the long term if governments
                      "demonstrate a capacity to comply with
                      international law" by settling outstanding
                      claims.

                      Last Wednesday, demonstrators
                      besieged Nestle's UK headquarters
                      demanding the company drop claims to
                      collect $6 million from Ethiopia. The
                      average person in Ethiopia makes less
                      than $2 a day, while the Swiss giant
                      makes about $6 million every hour, aid
                      agencies say.

                      Nestle posted sales of $59.36 billion for
                      2001 and pre-tax profits of $6.15 billion.

                      Nestle's business in Ethiopia was seized by the previous regime in 1975. The
                      company wants compensation although now it says it will reinvest any damages in
                      the country, after five days of protests by aid agencies.

                      The Ethiopian government has already offered $1.6 million to resolve the issue.

                      Ethiopia is struggling with a famine that could see as many as 11 million people
                      facing starvation, aid workers and government officials say.

                      Nestle remains a target for protesters in various parts of the world. The company
                      leads many boycott lists because of controversy over its baby milk formula in the
                      developing world. Nestle denies its milk products can harm infants' health.

                      In an attempt to improve its image, Nestle unveiled a set of principles in March.

                      But it says it was caught off guard by last week's protests over Ethiopia and admits it
                      stumbled when it first said it wanted the bill paid in full.