General Motors' plant seized in Venezuela
General Motors said it is ceasing its operations in Venezuela because of an illegal judicial seizure of its assets.
After operating in the country for roughly seven decades, the company was forced to cease its operations in the country, after government authorities seized its assets including vehicles.
The company claims that the seizure took place in total disregard of its right to due process and has caused an irreparable damage to its 2600 plus workers and 79 dealers across the country.
General Motors in a statement said: “As a consequence, GMV announces the immediate cessation of its operations in the country, and ensures (as far as the authorities permit) payment of the employees’ separation benefits arising from the termination of the employment relationships due to causes beyond the parties’ control.
“GMV strongly rejects the arbitrary measures taken by the authorities and will vigorously take all legal actions, within and outside of Venezuela, to defend its rights.”
Venezuela is facing recession for the third consecutive year. It economy shrank by 18% in 2016 and unemployment is expected to surpass 25%. Economic slowdown has resulted in severe political unrest in the country as well.
In the recent past, several multi-national companies have either pulled out or have been forced to stop operations.
Last year soft-drinks giant Coca-Cola stopped its operations in the country due to shortage in sugar. The country was once, one of the largest sugar producers in the region.
Similarly, other companies such as Ford Motor, Kimberly Clark, Procter & Gamble, Bridgestone and General Mills have all quit Venezuela.
The Government has been trying to exercise control over several sectors including energy, oil and automotive. In 2007, Exxon Mobil and Conoco Phillips left the country, as the government took a majority of stake in their operations.
Image: GM ceases operations in Venezuela. Photo: Courtesy of Yavno/Wikipedia.