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July 02, 2008

UK supermarket group to stop vegetable imports from Zimbabwe

UK supermarket chain Tesco is to stop importing about £1m of fresh vegetables from Zimbabwe, reversing its previous stance that the trade was essential to support the families of the farm workers who grow crops such as mange tout and baby corn.

The supermarket group said its abrupt U-turn followed the escalating political crisis last weekend and growing consensus in the international community, including among UK politicians, that further action was needed to maximise pressure for change.

Tesco added that it would be looking for other ways to support the farmers and hoped to resume imports from Zimbabwe once stability returned to the country.

Peter Hain, the former Africa minister who led the anti-apartheid campaign in the 1970s, welcomed the Tesco move. "It gives a lead to other British and global companies to suspend or freeze their trade and investment in Zimbabwe until Mugabe's tyranny is ended."

British companies still trading with Zimbabwe include mining groups such as Anglo American and Rio Tinto, Unilever - which makes consumer products at a factory near Harare - and the banking groups Barclays and Standard Chartered.

However, several UK-owned businesses in Zimbabwe said disinvestment would increase the suffering of ordinary people and allow business cronies of Robert Mugabe's government to buy the assets at bargainbasement prices.

Waitrose, which imports fair-trade tilapia from a fish farm on Lake Kariba, said while it shared concerns about the situation in Zimbabwe, withdrawal would hurt the workers at the fish farm and their families.

The Foreign Office said it was not calling for commercial sanctions except where the trade supported the regime or benefited its members. British policy was to strengthen targeted sanctions against leading figures in the country's government and their families.

Support for this position came from Peter Tatchell, the human rights activist who in 1999 tried to make a citizen's arrest on Mr Mugabe. "It's unlikely that a withdrawal would have a serious adverse effect on the regime," he said. "Much more important would be the extension and toughening of sanctions against officials and their families, suspension from the African Union and peacekeepers to stop the violence."

Heads of British-owned companies in Zimbabwe are referring queries about their future plans to their headquarters in the UK.

Many of the UK-owned businesses are making no profit during the economic turmoil, but have remained amid hope of a political solution before much longer. "Neither we nor our foreign shareholders want to go unless forced to by indigenisation," one executive said.

Banks accused of lending money to the government or to prominent members of the ruling party say they have no choice.

Tesco is ending imports of produce from Mitchell & Mitchell, which has 4,000 employees. Waitrose imports tilapia fish farmed by Lake Harvest, which employs 450 staff.

Financial Times

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