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Kellogg's exits Venezuela over social and economic 'deterioration'

Kellogg's exits Venezuela over social and economic 'deterioration'”

Amid a desperate economic and humanitarian crisis in Venezuela, its socialist leader Nicolas Maduro is trying to shore up support from the few allies it has left, and has had state oil firm PDVSA buy foreign oil worth US$440 million and sell it at below-market prices on friendly credit terms to Cuba, Reuters reports, quoting internal company documents it has reviewed.

Kellogg's announced on Tuesday that it will end its operations in Venezuela, citing "economic and social deterioration" in the country.

In a statement, Kellogg said: "The current economic and social deterioration in the country has now prompted the company to discontinue operations".

According to Euromonitor, Alimentos Kellogg dominated the breakfast cereals sector in Venezuela previous year with a 50% retail value share.

"We've begun judicial proceedings against the business leaders of Kellogg's because their exit is unconstitutional".

Poor access to raw materials and scarce dollars to import goods due to currency controls impaired Kellogg's ability to operate its Venezuelan subsidiary, the company said in February.

President Nicolas Maduro, who has previously accused the United States of waging economic war against his government, called the closure "absolutely unconstitutional and illegal".

The food giant is just the latest worldwide company to partially or completely close shop in the troubled and chaotic nation, following others such as Kimberly-Clark kmb and Colgate-Palmolive cl . In 2014, authorities took over two plants belonging to USA cleaning products maker Clorox Co after its departure.

Corn Flakes may be even scarcer in Caracas.

"Kellogg is not responsible for the unauthorised use of the commercial names and brands that are the property of the company and will exercise legal actions available as necessary", the company said, adding it would like to return to Venezuela in the future.



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