Coca-Cola FEMSA warns of Venezuela production halt
Coca-Cola FEMSA said there were difficulties obtaining sugar
Coca-Cola FEMSA has warned it may have to close its production plants in Venezuela if ongoing sugar shortages continue.
The company said on Friday its factories in the country, which is in the grip of a severe economic crisis, are currently still running. However it warned that the plants were using existing inventories of sugar. If they are not replenished "as soon as possible" there will be "temporary" halts to production, the company said.
"The national sugar factories that provide us with refined sugar for industrial use for our operations have told us they have temporarily ceased operations due to lack of raw materials," Coca-Cola FEMSA said. "We are advancing specific actions that allow us to face this situation in coordination with suppliers, authorities and our workers."
Venezuela has been hit by a spiralling economic crisis that has led to shortages of basic goods and the government announcing a two-day work week for public services. The International Monetary Fund has warned that inflation could hit 700% this year in the country.
PepsiCo last year took a US$1.36bn impairment charge on operations in Venezuela, with CEO Indra Nooyi warning that she had not seen comparable global macroeconomic challenges in her time in business.
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