by frog
According to the Sunday Star Times this morning:
[A] Christchurch political scientist says Fonterra’s lack of understanding of the Chinese political and business environment meant the dairy giant was out of its depth before it had even bought its 43% shareholding in China’s largest dairy company, Sanlu, in late 2005 for $US107m.
That remains one of my nagging concerns about large multinational firms expanding into countries they don’t have a cultural understanding of – too often it appears to be driven by a need to keep expanding and growing rather than a desire to be providing high quality goods or services that would not otherwise be in their hosting country. Fonterra was not short of money or business before it moved to China. Fonterra’s business interests in China were not about New Zealand farmers – it was not New Zealand milk being sold, and clearly as we are learning its work over there was not in the interest of Chinese consumers.
Which is not to say the specific situation would be better or worse without Fonterra there overseeing Sanlu. But too often at a more general level it does seem that large multinationals move in to a country with the specific purpose of buying out, or merging with their competition, growing and expanding, then lack the moral, ethical or cultural compass of their host nation.
Our company is a guest in China. As I read the ongoing news of dieing and ill babies I hope they were good guests who respected and learnt from their hosts, rather than just crass tourists who were trying to replicate their own corner of the world in a foreign land.
Published in Health & Wellbeing | Society & Culture by frog on Sun, September 21st, 2008
on the trolls and those who are unable to keep on topic
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I understand that Fonterra has a minority (43% or 3/7) interest in Sanlu. What I haven’t heard is who has the rest? Fontera said (according to them)to pull the contaminated milk from the market. Who was it that said “No”?
Trevor.
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Canada’s Globe & Mail has a startling expose on the dairy industry in China in which it is reported that Fontera had to resort to dimplomatic channels to pressure Chinese officials to act to save the lives of China’s babies.
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http://www.theglobeandmail.com/servlet/story/RTGAM.20080919.wmilk19/BNStory/International/home
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The big problem as I see it is that formula is being advertised as better than breastmilk in China. This is probably not Fonterra’s fault at all, they may not even know it (such advertising is illegal in China but still used apparently), and maybe Sanlu is completely honest in their advertising and it is only other companies flouting the law like this. But this is a serious problem, because if people who can breastfeed switch to formula thinking it is better, the children lose out, and the total expense to society is far higher (formula cost and higher medical cost throughout their lives as they will be less healthy than breastfed children),
http://sjdennis.wordpress.com/2008/09/19/formula-marketed-as-better-than-breastmilk-in-china/
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Yes, that is not just a big problem, it is ethically questionable. It seems that many Asian people are lactose-intolerant, so pushing cow’s milk and a dairy industry on such people seems counter-intuitive to me. There is probably a place for milk for babies whose mothers for whatever reason are unable to breast-feed, but that’s about it.
As for importing Chinese milk into New Zealand for Asians to buy – madness!
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