Danish companies hope to avoid new cartoon boycott

COPENHAGEN, Oct 10 (Reuters) Danish industry today praised swift government action to calm Muslim indignation at new cartoons mocking the Prophet Mohammad and said so far it had largely avoided a consumer boycott of Danish goods.

Muslim anger was roused last week when public Danish television aired amateur video footage showing members of the youth wing of the anti-immigrant Danish People's Party (DPP) taking part in a competition to draw images mocking the Prophet at a summer camp in August.

The Confederation of Danish Industry (DI) said a clear condemnation of the events from the prime minister and the foreign minister this time could limit the damage to exports.

''This unfortunate matter has been handled competently by the government and so far we've only had two companies in Saudi Arabia report that they were affected,'' said Peter Thagesen a Senior Advisor at DI.

A year ago, a Danish daily published cartoons of the Prophet, sparking protests in which more than 50 people died in Asia, Africa and the West Asia.

Most Muslims regard any depiction of the Prophet as offensive and angry crowds attacked Danish embassies and consumers boycotted Danish goods in several countries.

DROP IN EXPORTS DI estimates the boycott that started at the end of January in response to the first batch of cartoons resulted in a drop in exports to affected Muslim countries of 15.5 per cent in the period February-June compared with the same period last year.

Exports to Libya and Yemen were most affected, falling 88 and 62 per cent, while in Turkey, the largest Muslim export market, the situation was unchanged.

Total Danish yearly exports to Muslim countries are about 10 billion crowns, or roughly two per cent of all exports.

Danish Prime Minister Anders Fogh Rasmussen quickly condemned the behaviour of the DPP members in the video footage. He was criticised earlier this year for refusing to apologise for the previous assortment of cartoons lampooning the Prophet and for refusing to meet Muslim envoys to discuss the cartoons.

The DPP is not a member of the ruling coalition, but supports the government in parliament.

''I think the entire Danish export industry is satisfied with how quick the response from the Danish government has been this time round,'' said Astrid Gade Nielsen, a spokeswoman for dairy giant Arla Foods, which was hit hard by the boycott.

Nielsen said Arla lost market share but still hopes to reach about half its regular sales by the end of the year from current levels of about 35-40 per cent.

''We receive daily reports and so far our customers, the retailers, have not seen any new action,'' she said.

Reuters SHB DB2241