Canadian Manufacturing

Venezuelan government seizes U.S.-owned plant

State says it will restart production at factory owned by American consumer products giant Kimberly-Clark after company shut down facility



Venezuela has faced increasing upheaval in recent months as U.S. companies pull out of the country where  protests  and goods shortages have become commonplace. PHOTO: durdaneta, via Flickr

Venezuela has faced increasing upheaval in recent months as U.S. companies pull out of the country where protests and goods shortages have become commonplace. PHOTO: durdaneta, via Flickr

CARACAS, Venezuela—Venezuela’s government said July 11 that it will seize a factory belonging to Kimberly-Clark Corp. after the U.S. personal care giant said it was no longer possible to manufacture in this crisis-wracked South American nation.

President Nicolas Maduro accused Kimberly-Clark of participating in an international plot to damage Venezuela’s economy and said his socialist government would provide public funds to the workers at the plant.

Speaking on television and radio, Maduro also announced that U.S.-based Citibank, which has handled some of the state’s international transactions, notified authorities that it would close the accounts of the Central Bank of Venezuela in 30 days. He linked both actions to the economic war on Venezuela, calling it “the new imperialist inquisition” of U.S. President Barack Obama.

Labor Minister Owaldo Vera said earlier that the government would take over the Kimberly-Clark factory at the request of the 971 workers who have occupied the plant that the company decided to shutter in central Aragua state.

Kimberley-Clark announced on Saturday that it was suspending production in Venezuela because of a lack of primary materials, currency trouble and soaring inflation. The company made a number of hard-to-find staples in Venezuela such as diapers and face tissues.

“Kimberly-Clark will continue producing for all of the Venezuelans,” Vera said in a televised statement from the factory surrounded by workers chanting pro-government slogans.

The Irving, Texas-based company said Monday that it acted appropriately in suspending operations.

“If the Venezuelan government takes control of Kimberly-Clark facilities and operations, it will be responsible for the well-being of the workers and the physical assets, equipment and machinery in the facilities going forward,” the company said in a statement.

Kimberly-Clark joins Bridgestone, General Mills, Procter & Gamble and other multinational corporations in scaling back operations in Venezuela amid its economic crisis.

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