Kellogg ceases business activities in crisis-wracked Venezuela

Clay Curtis
May 17, 2018

"The current economic and social deterioration in the country has prompted the company to discontinue operations".

The food shortages and violence happening in that country can be traced back to President Maduro, who "basically bent Venezuela's democratic process to his will", Oliver said, noting thecreation of a powerful new constitutional assembly that critics called the end of Venezuela's democracy. The company has been producing cereal in Venezuela since 1961 and the market had at one point been its biggest in Latin America after Mexico although in 2016 it deconsolidated its Venezuela business from the company's overall earnings results.

President Nicolas Maduro announced that the closure from Kellogg was "absolutely unconstitutional and illegal". Kellogg's plant was taken over after it revealed that it was pulling out of the country as it continues to face a worsening economic and political situation.

"With no notification, this US-based multinational made a decision to close its doors, leaving 570 workers hanging", said Mr Torres at the plant, in Maracay.

Other multinational companies that have given up on the OPEC country, abandoning assets or selling them cheap, include Clorox CLX.N , Kimberly-Clark KMB.N , General Mills GIS.N , General Motors GM.N and Harvest Natural Resources.

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Oliver explained that Maduro's government routinely rejects humanitarian aid, including medicine and food, which its people desperately need. Despite the problems, Maduro is expected to win re-election on Sunday in a vote the main opposition coalition says is a sham.

Maduro is blaming everyone for his mess, mostly the US, but "accusing America of creating Venezuela's crisis is about as fair as accusing O.J. Simpson of murdering Princess Diana - I'm not saying it would be completely out of character, it just happens to not be true in this particular instance", Oliver said.

Socialist Maduro has taken over the factories of some companies that have left the country.

It also 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".

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