The United States based cereal maker Kellogg is pulling out of Venezuela because of the economic deterioration in the country. Workers said they were prevented from entering the plant in the central city of Maracay on Tuesday. The announcement comes ahead of Sunday's presidential elections.
President Nicolas Maduro, who is standing for re-election, told a rally that he would hand control of the factory over to the workers.
We've begun judicial proceedings against the business leaders of Kellogg's because their exit is unconstitutional, Mr Maduro told cheering supporters in the central state of Carabobo.
I've taken the decision to deliver the company to the workers in order that they can continue producing for the people.
Venezuela's battered economy has been hit by falling oil revenue and the plummeting value of its currency, the Bolivar. It has one of the highest rates of inflation in the world. In the year to the end of February 2018, prices rose by more than 6,000%, according to the opposition-dominated National Assembly.
Kellogg is the latest multinational to close or scale back operations in Venezuela, citing strict currency controls, a lack of raw materials and soaring inflation. It said it hoped to return to Venezuela in the future and warned against sales of its brands without the expressed authorization of the Kellogg Company.
In 2016, Venezuela's government took over a plant belonging to US-based hygiene products manufacturer Kimberly-Clark after it announced it was stopping operations because it could not obtain raw materials. The Texas-based firm recently requested the start of arbitration proceedings against Venezuela at the World Bank.
President Maduro, who has been in office since 2013, blames Venezuela's problems on an economic war being waged by foreign governments and businesses. His critics say government mismanagement is the chief cause.
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President Nicolas Maduro, who is standing for re-election, told a rally that he would hand control of the factory over to the workers.May 16th, 2018 - 04:24 pm +1
Typical populist BS.......can imagine what will happen after he hands over the administration to the 'highly-qualified' workers....and presumably puts a Colonel in the position of company president.
“We've begun judicial proceedings against the business leaders of Kellogg's because their exit is unconstitutional,” Mr Maduro told cheering supporters...
unconstitutional ?” the idiot has lost all sense of reality. If he were coherent, even in the slightest sense of the word, he would have banned all US companies from VZ long ago.
He is totally lost and just says what he thinks the people want to hear.
It must be difficult for Maduro. The whole 'economic war' thing would be ever so much more plausible if the factory had closed years ago instead of today, and if the USA wasn't still buying Venezuela's oil. We know what real economic war looks like; there are no Kelloggs factories in Cuba.May 16th, 2018 - 03:12 pm 0
”unconstitutional ?” the idiot has lost all sense of reality.May 16th, 2018 - 04:57 pm 0
Agreed. Trying to prosecute them for closing their business in the country is mad enough anyway, but if he thinks there's some kind of 'economic war' against Vz, why does he want multinationals there in the first place?
To be fair, I suppose the fact the factory was able to survive until today means the economy is still functioning in some fashion. but things may be about to get much worse if PDVSA are unable to export their oil.