President Maithripala Sirisena recently launched an outspoken attack on the firm, claiming it had increased the sugar content in Milo from 15% in 2012 to 16.5% today.
"I want them to reduce it to 5%, otherwise we will bring legislation to control the sugar content in all beverages," he threatened, while brandishing a Milo carton. He said he would tour the country campaigning against its consumption unless Nestlé agreed to reduce the added sugar.
But Samantha Mendis-Wedage, senior manager of corporate communications at Nestlé Lanka, said the firm had reduced added sugar in recent years.
“Over the last five years, we have reduced added sugar (sucrose) in Milo Ready-To-Drink (RTD) by 32%. Currently, a MILO RTD pack contains only 8.2 grams (less than 5%) of added sugar.”
“By our own internal analyses, Milo RTD currently contains one of the lowest levels of sucrose in the local milk-based beverage category,” she added.
Diabetes discussion
The president had also asked the finance minister to extend the tax on soft drinks to all forms of sweetened beverages. Sri Lanka’s latest budget put in place a 50-cent tax on each gram of sugar in soft drinks, which took effect earlier this month.
The president made these remarks at a walk marking World Diabetes Day.
The official website of the president did not mention these statements, only that he proposed to declare a “diabetic month” to raise the awareness of diabetes among people, “pointed out the importance to display the level of sugar in the ingredients of the packets of milk powders” and stressed the importance of “the tax imposed on sweet drinks, decided in the last year’s budget”.
Meanwhile, Nestlé Lanka’s profits have plunged by more than 30% year-on-year in each of the past three quarters.
Factory developments
Several reasons for this include the food and beverages market in Sri Lanka having been hit by severe drought and floods, which has led to people having less money and buying less. In the past two years, Sri Lanka has also been experiencing financial troubles, with the state subsequently raising taxes.
At the time of publishing, Nestlé has not replied if President Sirisena’s statements are expected to have further impact on Milo sales and Nestlé’s profits.
Ironically, in 2016, the president himself presented an award to Nestlé Lanka for Best MNC engaged in Exports.
Nestlé Lanka began work on its new facility in Kurunegala in January, which will expand the company’s capacity for dairy and coconut-based products.