Venezuelan authorities arrested several Pepsi employees Friday which were then freed Sunday. President Nicolas Maduro has called the head of Pepsi’s Venezuelan contractor Polar an “Oligarch of the devil.”
Venezuelan authorities justified their actions by saying Polar was not producing enough Pepsi products. Polar justified its lack of production in that it is a privately held firm and lacks the resources to produce Pepsi goods.
Due to Venezuela’s economic crisis and outlandish currency controls which have been implemented by the socialist government, Polar cannot import certain raw materials needed for production.
Those arrested were from Polar’s legal, production, and human resources divisions.
[dcquiz] Two weeks ago, the Socialist government lost in the country’s legislative elections. A pro-market opposition coalition won a supermajority in the country’s National Assembly. This will now be the first time the socialist government has had to share power with the opposition.
In October, Pepsi was forced to pay $1.4 billion to comply with new laws regulating accounting practices of businesses operating in Venezuela. According to CNN Money, this means that Pepsi only made $326 million in Venezuela from $16.3 billion in third quarter revenues. The firm has stated that this was a one-time fee.
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