HomeCommentNestlé Pressured to Accept Gushungo Milk

Nestlé Pressured to Accept Gushungo Milk

PRESSURE is reportedly mounting on Nestlé Zimbabwe to accept milk from Gushungo Holdings, a company owned by First Lady Grace Mugabe, with the latest tactic being delaying the granting of a work permit to the company’s newly appointed managing director.

The milk processing company bowed to international pressure in September and stopped buying milk from Gushungo Holdings. This led to a fallout with various political and economic players sympathetic to Mugabe as they said the dairy company was applying sanctions on the First Family.

In September Nestlé had its accounts frozen by the Reserve Bank citing irregularities. Interested parties have continued to pile pressure on the dairy firm to reverse its decision and there have been threats of its complete takeover.

The latest attempts to armtwist Nestlé into accepting milk from Gushungo Holdings has prompted high ranking officials, including the head of the Eastern and Southern African region, to come to the country and try to find a solution to the problems.

Nestlé Zimbabwe appointed a new managing director last October who was expected to have started work immediately. However, this has not happened as there were delays in processing a work permit, a development which has been linked to the attempts to armtwist Nestlé into reversing its decision to stop buying milk from Gushungo Holdings.

Sources at the milk processing company confirmed that they were still waiting for regulatory approvals before the new boss could take office.

Nestlé remains one of the leaders in the dairy industry with relatively more disposable cash than other players in an industry that is facing stiff competition from South African products.

As such, Nestlé is able to pay for milk deliveries on time while other players in the milk industry have been struggling to raise cash making it the preferred buyer of the product.

This has prompted sympathisers of Gushungo Holdings to continuously look for an opening and have the decision to stop buying its milk reversed.

Nestlé Zimbabwe did not have a long-term contract with Gushungo Holdings and seven other milk producers and it only started accepting milk from them in February this year after the other players failed to pay for deliveries.

This decision was made to save the industry.Nestlé has been in Zimbabwe for 50 years.-Staff Reporter


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