CARACAS— Clorox Co. said Saturday that it has serious safety concerns as Venezuela’s government authorized a takeover of its facilities just days after the cleaning-products maker announced it was ending operations here due to the South American country’s economic crisis.
“This is now a factory liberated by its workers,” Vice President Jorge Arreaza said on Friday night in a televised address from one of Clorox’s facilities just outside this capital city. Flanked by workers from the plant, Mr. Arreaza offered the state’s full support of a worker-led restart of operations and saving what he said were 800 jobs that would be lost.
Though rich in oil, Wall Street analysts expect Venezuela’s economy to fall into a recession this year amid dollar shortages, a collapsing local currency, spiralling inflation and rigid state controls that economists say deter investment.
Oakland, Calif.-based Clorox, which had three manufacturing plants in Venezuela, said on Sept. 22 that it was exiting the country and looking to sell its assets. The company, which manufactures bleach and other cleaning liquids and disinfectants here, argued that for nearly three years it had to sell two-thirds of its products at a loss as prices set by the state failed to cover the cost of production.
Private-sector businesses complain price caps, as well as limited access to dollars for imports are responsible for Venezuela’s chronic shortages of some foods and goods ranging from cooking oil to toilet paper. But the government, whose popularity has plunged this year amid the economic woes, blames the country’s problems on its political foes and what it says are profit-hungry multinationals out to destabilize the socialist regime.
“You think it’s a coincidence that these people are leaving just when there is a situation of shortages of some products in the country?” Mr. Arreaza said to supporters who chanted ” Chavez Lives!” in remembrance of the late leftist leader Hugo Chavez who expropriated scores of companies during a 14-year reign.
“It would seem to be part of a plan to harm the Venezuelan people,” Mr. Arreaza, who is also Mr. Chavez’s son-in-law, said.
via Clorox Questions Safety After Venezuelan Takeover – WSJ.