The Big Food Group which owns the Iceland chain of food stores, has abandoned its more than 12M pounds sterling claim against Guyana for the nationalisation of the sugar industry 27 years ago.
According to yesterday's edition of the UK Guardian newspaper, the group announced this after coming under pressure from developing world debt campaigners since the weekend. The paper quoted the company as saying: "We have reviewed this matter carefully and believe the interests of both our company and those of the people of Guyana are best served by not proceeding."
The Guardian reported a Big Food Group spokesman as denying that the decision had come as a consequence of the negative publicity of the last few days: "We would not make this kind of decision in a day," he was quoted as telling the daily, "I can assure you it has taken some months."
The company had been seeking compensation for the nationalisation of Guyana's sugar industry in 1976, then owned by Bookers. Guyana had paid back about 6.2M pounds sterling - or about half of the original nationalisation debt - but had defaulted on payments in 1989 at the time of the Latin American currency crisis. The company had been seeking the balance of 6.8M pounds sterling plus interest, along with the costs of proceedings, which when totalled up would have exceeded 13M pounds sterling.
Three years ago, the Big Food Group had merged with the Iceland Group, which had earlier taken over Booker Cash and Carry. In pursuit of its claim, the new conglomerate had decided to take advantage of a bilateral investment treaty between Guyana and the UK in which Guyana had agreed to arbitration in cases of dispute, rather than have recourse to legal action.
The company had reached agreement with Guyana to move to arbitration, therefore, and in September 2001 it had presented its case to the International Centre for the Settlement of Disputes in Washington. The hearing had been slated for the end of this month in London.
Earlier this year, the Wales on Sunday had reported a Big Food Group spokesman as saying that the compensation for the nationalisation represented only a fraction of the value of the expropriated sugar assets, which had been valued at 186 million pounds sterling in 2000.
Ashok Sinha of the Jubilee Debt Campaign, which had recently begun a campaign to pressure the Big Food Group to drop its claim against Guyana, was quoted in Monday's edition of the Guardian as saying that this country was among one of the world's poorest, and was receiving debt relief on money owed to the World Bank as well as countries like Britain. "It hasn't been granted debt relief by the international community just so that Iceland can pick up a slice of the proceeds," he said.
Yesterday's Guardian reported that campaigners had planned that morning (Tuesday) to dress up as penguins - the corporate logo of the Iceland chain - and protest outside one of their stores in Clapham, south London, with banners reading: "Penguins against third world debt." This newspaper was told by a source that when the campaigners appeared, a representative of the company came out and told them that the Big Food Group was withdrawing its claim.