danish products bak on shelves!?

Products of Danish dairy company return to Saudi supermarket shelves

04-04-2006

By M. Ghazanfar Ali Khan

RIYADH, Arab News — Products of the Danish dairy conglomerate Arla Foods, maker of the popular Lurpak brand butter, will be back on the supermarket shelves in Saudi Arabia from tomorrow. Abdullah Al-Othaim, chairman of Al-Othaim Group, and Abdulaziz Al-Munajem, general manager of A.A. Almunajem Sons Co., made the announcement at a crowded press conference here yesterday.

A general boycott of Danish products after a newspaper in Denmark published 12 cartoons denigrating the Prophet Muhammad (peace be upon him) last September, has led to Arla suspending plans to expand its operations in Kingdom. “The unofficial boycott has been lifted and this is only for Arla products,” said Al-Othaim.

The move comes following a recommendation made by five Islamic organizations, including the World Assembly of Muslim Youth (WAMY), which participated in an Islamic conference in Bahrain last month to debate the issue surrounding the blasphemous cartoons originally published in Jyllands-Posten, Denmark’s largest daily.

Arla Foods had issued an apology to Muslims worldwide as the company is based in the country where the newspaper is published. It has also pledged to disseminate awareness about Islam and make donations to charity groups.

Arla has a major dairy plant in Riyadh, which had to suspend operations temporarily due to a sharp decline in demand for its products. A new production facility planned for Saudi Arabia has been indefinitely put on hold, according to Jan E. Pedersen, Arla’s regional director.

“We have deferred plans to set up the multimillion dollar production plant because of the boycott of Danish products and its adverse impact on our sales in the region,” said Pedersen.

Arla had already invested $70 million to build the new plant in cooperation with Danya Foods of Saudi Arabia.

The plan was being implemented with an aim to maintain Arla’s position as market leader in terms of sales and production of fresh cheese, butter and cream in the Middle East. The project, which was conceived to boost sales of Arla’s products from the current 60,000 tons per year (before the cartoon controversy) to 120,000 tons by 2010, was in its implementation phase when the controversy erupted.

Replying to a question about the termination of workers from its Saudi operation, Pedersen said “the company, which had terminated some 200 workers in Denmark, had not laid off any worker in the Kingdom.”