Locals win battle against Asda over superstore plan for market

The residents of one of London's poorest boroughs claimed victory yesterday against Asda, the world's most powerful retailer, after it ditched plans to open a superstore on the site of a thriving street market.

Britain's second-biggest supermarket chain, which is owned by Wal-Mart of the US, has decided not to open a store in Newham's Queens Market in east London. The proposed outlet has been the subject of intense controversy, even featuring in a film aimed at depicting Wal-Mart's evils, released nationwide last month.

Asda claimed it was withdrawing because it was forced to scale back its plans. The group said it was "very sorry" its hopes had been stifled. The chain, which is facing tough competition as rivals pick up their game and expand, said it had planned to build a ground-floor superstore.

But the "opportunity" had since changed to a store on two floors, with clothing on the ground floor and food on the second. "We have tried our hardest to make our store fit the new layout, but it simply wouldn't work for our customers," the group said.

The proposed store was unpopular with many residents who feared traders in their ethnic food market would be forced out of business by the supermarket behemoth. A campaign to stop the development was backed by celebrities including the poet Benjamin Zephaniah and the film-maker Robert Greenwald, who directed Wal-Mart: The High Cost of Low Price, which featured the struggle. The Mayor of Newham, Robin Wales, said: "Asda have decided that they could not deliver what we wanted for our residents."

New Economics Foundation, a think-tank that champions quirky high streets over "clone towns", said it was delighted. Recent research from the NEF had shown local street markets generate twice as many jobs as big supermarkets and sell goods at half the price of the supposedly cut-price retail giants.

Guy Rubin, a senior researcher at NEF, said: "A vibrant local campaign has taken on one of the world's biggest companies and won, This is a tremendous victory for local economic common sense in the fight back against Clone Town Britain. by proving big supermarkets don't just threaten local economies, communities and diversity - they don't meet local needs."

Newham council said it was confident St Modwen Properties, the development partners charged with the regeneration project, will attract another big retailer to the project. Asda has a store close by in Beckton.