Venezuela seizes Kellogg cereal factory after closure (BBC)

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    Venezuela seizes Kellogg cereal factory after closure – By BBC Newsroom (bbc.com) / May 16 2018

    Authorities in Venezuela have seized a plant owned by the American cereal manufacturer Kellogg.

    It comes after the firm announced it was pulling out of the country because of the worsening economic situation.

    President Nicolas Maduro, who has previously accused the US of waging economic war against his government, called the closure “absolutely unconstitutional and illegal”.

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

    Earlier, workers had said they had been prevented from entering the plant in the central city of Maracay on Tuesday.

    The announcement comes ahead of Sunday’s presidential elections.

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

    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 authorisation 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.

    http://www.bbc.com/news/business-44136293

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