Kellogg pulls out of Venezuela due to country's 'deterioration'

Lawrence Kim
May 16, 2018

Kellogg has had a presence in Venezuela since 1961, and the market is its second largest in Latin America after Mexico.

He said the factory had been handed to workers and would continue production.

"With no notification, this US -based multinational chose to close its doors, leaving 570 workers hanging", said Torres at the plant, in Maracay. Because Venezuela is having a presidential election on May 20, he explained, "tonight, we thought we'd check in on what's been happening there, to try and understand how Venezuela got into this mess and how, despite making it even worse, their current president, Nicolas Maduro.is nearly certainly going to win, despite having the support of only about a fifth of the population".

"We've begun judicial proceedings against the business leaders of Kellogg's because their exit is unconstitutional", Maduro added to cheers from red-shirted supporters.

"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 also has one of the highest rates of inflation in the world.

Under the backdrop of strict price controls and hyperinflation, Kellogg is the latest multinational to exit the country.

The company said product distribution in Venezuela has been suspended and the license agreement for the use and commercialisation of its brands has been terminated.

The Texas-based firm recently requested the start of arbitration proceedings against Venezuela at the World Bank. Maduro blames Venezuela's crisis on an "economic war" that he says is being waged by Washington, greedy businessmen and coup-mongers. In that sense, it said that democratic vocation will cause the media campaign promoted against the South American nation to fail, as well as that assumed by sectors of the opposition to ignore the electoral call, and the threats of the United States government and its global allies.

Other reports by Click Lancashire

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