Mandelson frothy over Starbucks

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Last Modified: 18 Feb 2009
By: Jane Deith

The coffee chain Starbucks has rowed back from comments made by its chief executive on US television that sparked a row with business secretary Peter Mandelson.

The chairman of Starbucks Howard Schultz was on the business network CNBC to talk up his new instant coffee brand but when he was asked about the economic crisis, he put the blame at Britain's door.

Mandelson was booked for the same show and Schultz's comments had filtered back to him, leaving a bitter taste.

He insisted the UK is not spiralling and claimed Starbucks is in a great deal of trouble.

Mandelson was in New York to dispel gloom about the British economy so when the Guardian's New York correspondent asked him about Howard Schultz's swipe at a drinks party at the British Consul, he said what he really thought.

He swore about the comments and criticised Starbucks again.

The coffee chain's profits are falling. It is closing 300 stores and Peter Mandelson's spokesman says he does not stand by the language, but does stand by the sentiment of his comments.

A Starbucks spokesperson said: "Starbucks has no intention of criticising the economic situation in the UK. The reality of the global economy is that no country is immune to the difficulties. We are all in this together.