NESTLE’S INVESTMENT IN ZIONISM Employing 224,541 people in 479 factories worldwide, Nestle is not only Switzerland’s largest industrial company but also the world’s largest food company. (1) This corporate prominence means that what Nestle does sets an example for thousands of aspiring businesses. According to the Swiss-Israeli chamber of commerce, one of the most important examples Nestle has set is that it is advantageous to invest in Israel. (2) Nestle began investment in Israel in 1995 by buying 10% of Israeli food maker Osem Investments. Two years later Nestle increased its ownership, at a cost of $140 million, to 50.1% giving it the controlling share. (3) A January 2002 agreement between the Swiss and Israeli governments to avoid double taxation for Swiss companies that produce in Israel and sell in Europe led Nestle to announce in September 2002 vast expansion in Israel that will pour $80 million more into the Israeli economy. (4)Nestle’s main presence in Israel is in Sderot, a settlement founded in 1951 one kilometer from the Gaza Strip to accommodate an influx of Sephardic Jews in and to spread Jewish presence uniformly throughout Israel. (5) Sderot is built on the lands of the Palestinian town Al-Najd, which was ethnically cleansed in 1948. (6) Today Sderot is home to 23,000 Jewish immigrants from Morocco, Ethiopia, and the former Soviet Union, half of whom came in the last ten years. (7) Like many sites for immigrant settlement, or “development zones” as they are known to the Israeli state, Sderot lacks basic facilities that make for a comfortable living. It has the highest unemployment rate in Israel (10%) and a full 30% of the children living in Sderot depend on private and government charity. (8) 25% of the recent immigrants’ children do not finish school. (9)Enter Nestle: Jointly with Osem, Nestle already runs a 700 m2 factory in Sderot, and last year the company announced that it intended to open a 1,700 m2 research and development center there. (10) Such operations provide a decent wage and living in an other-wise poverty-stricken town. They, also, enable the Israeli government to continue to import Jews who will fill the land of Israel while denying Palestinians their right of return. In 2002 Nestle received a grant for 24% of the $5.6 million cost from the Israeli government, which offers various incentives to encourage investment in development zones. (11) The Israeli government gives these grants, funded in turn by US economic assistance, to companies that can help it solve the difficult social problems accompanying mass absorption of ethnically distinct groups. At the same time, building in development zones means building over the remains of Palestinian habitation. When the old stone buildings and stubborn cactus plants are covered over, so, too, it is hoped, are the grounds for a Palestinian history and right of return. In total, Nestle currently has over 4000 Israeli employees at 11 plants, with the following all in “development zones”:Tzabar Salads (an Osem subsidiary) plant in Kiryat Gat (on the former site of Palestinian village Iraq al-Manshiyya, destroyed by Israelis after 1948); a ready-baked cakes factory in Ahihud; and a logistics center will be built in Nachsholim (Al-Tantura) (12)But Nestle’s benefits to the Israeli economy don’t stop with just factories and jobs. The Research & Development center in Sderot is considered particularly beneficial to Osem’s growth as it ” gives [Osem] advantages in technological know-how and increased export opportunities through Nestle’s distribution network.” Consequently, Osem’s shares are growing five times faster than the rest of the Tel Aviv stock market. (13) Also, Nestle’s investment in Osem has meant that its products can reach a global market which is necessary not only to continued growth of the company but to its very survival in a time of deep local recession caused by the Intifada. Osem’s sales turnover in 2001 was $460 million, of which 15% came from exports (14).
Furthermore, Nestle-Osem contributes to community development through numerous charity projects. “Schools receive assistance through the Join the Industry project which introduces various aspects of Israeli industry to the classroom. Senior managers visit schools and teach classes about their industry. Schools are also welcome to visit the Company’s factories. Students receive guidance from Osem’s executives” (15).
These educational projects relieve the Israeli government of having to furnish a budget for educational advancement. At the same time, because they are carried out by a private company, they can be directed to the benefit of Jewish Israelis only. It is through such private efforts that the Israeli state can claim to act democratically – treating all its citizens equally – while Palestinians are flagrantly discriminated against.
Detractors from a boycott against Nestle point to the factory Nestle has on PA territory, in the Karni industrial zone in Gaza (16). Many companies active in Israel employ low-skilled Palestinian labor, finding it advantageous to use a captive resident population that is at once socially deprived (no insurance or union), politically oppressed, and able to provide its own food and board (17). The opening of Nestle’s factory in Karni, in spring 2000, should be understood in this context of abetting and benefiting from an apartheid system of social rights.In sum, Nestle builds on stolen Palestinian lands, covers up the ruins, provides jobs and opportunities that realize the Zionist goal of a purely Jewish presence in Israel and then sells the products of such an apartheid system abroad so that the Israeli economy can flourish while spending vast amounts on the oppression of Palestinians demanding their rights. No wonder Nestle received from Prime Minister Benjamin Netanyahu in 1998 the Jubilee Award, “the highest tribute ever awarded by the State of Israel in recognition of those individuals and organizations, that through their investments and trade relationships, have done the most to strengthen the Israeli economy.” (18)A CONSISTENT CORPORATE CRIMINAL:Since 1977, Nestle has been the subject of an international boycott for its deceptive promotion of artificial baby milk as a superior alternative to mother’s milk. Artificial baby milk can harm babies because it does not contain the natural antibodies which a mother’s milk provides, and because it is extremely expensive causing many mothers to mix it with too much water resulting in mal-nutrition. Also, in many places the water used to dilute it is not potable. Once a mother starts giving her baby formula, her own supply of milk dries up. Nestle provides free packages of formula in hospitals with the result that many babies never even get a chance to start nursing. In 1984 the boycott forced Nestle to agree to abide by the World Health Organization’s International Code of Marketing of Breast-Milk Substitutes. However, when it was discovered that the company has not abided by its promise, the boycott was re-launched in 1988. It continues vigorously to this day. (19)Nestle has also attracted criticism for its use of genetically modified ingredients, and for its cocoa and coffee-buying policies which encourage slavery. For example, Nestle purchases cocoa from the Ivory Coast where cocoa plantations use child slavery. (20) Most recently, the company has been implicated in lobbying against vaccination of livestock during the British Foot and Mouth Disease outbreak in 2001. (21)Does Nestle ever recognize corporate responsibility for human suffering caused by its management and production practices? In 2000, Nestle donated $20 million to Holocaust reparations funds, saying, ” As the legal successor of [Nazi] corporations, Nestlé nevertheless accepts its moral responsibility to help alleviate human suffering, all the more so since this injustice was committed in the Company’s domain.” (22) Such commitment to redressing wrongs visited on one sector of humanity makes Nestle’s hypocritical exploitation of Palestinian factory workers and investment in the apartheid structure of Israel all the more worthy of attack.
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