Nestlé sues Ethiopia for US$6 million! Check it out!

About 15 million people are going hungry in the country. Nestlé — the world's largest food company — wants one of the world's poorest countries — Ethiopia — to pay compensation of US$6 million (R$21.6 million) for the nationalization of one of its subsidiaries in the country during the communist regime in 1975. The lawsuit seeks to repair the damages caused by the government's large nationalization plan, when almost all foreign companies and properties operating in the country were confiscated without any compensation.

Nestlé's lawsuit comes at a time when the country is facing a new wave of drought and hunger. The government has been asking for international aid, claiming that 15 million people are going hungry in the country. Ethiopia is one of the world's poorest countries, with a per capita income of US$100 (R$360) per year. In Switzerland, home to Nestlé's headquarters, for example, per capita income is US$38,380 (R$138,160).

Decline The Ethiopian government's revenue has also suffered a major drop due to the worldwide decline in coffee prices, one of the country's main export products. Ethiopia's Minister of Finance and Economic Development, Mulu Ketsela, told the BBC that her country needs every penny it has to save lives, and that she would ask Nestlé to drop the lawsuit for the benefit of the people.

Nestlé told the BBC that it was "clearly in the interest of the continuity of foreign direct investment flows (to the country) that conflicts of this type be resolved in accordance with international law". "The success of the negotiations will restore the confidence of international investors, which will be beneficial to the Ethiopian government", the company stated. Nestlé also said that negotiations are taking place thanks to the willingness of the Ethiopian government, as part of an effort to compensate about 50 foreign companies affected by the nationalization process during the communist government.

The Swiss company also said that the Ethiopian government sold the Schweisfurth subsidiary in 1998 to a private company in the country for US$8.7 million (R$31.31 million). According to the British non-governmental organization Oxfam, the Ethiopian government offered about US$1.5 million (R$5.4 million) in compensation, but the company would be pressing for the government to reach US$6 million. The NGO says that US$6 million would be enough to supply 6 million Ethiopians with drinking water, or build 6,500 wells in the country's dry regions.