CNN reported last month that the country was down to $10.5 billion in foreign reserves, with inflation expected to rise 1,660 percent this year and 2,880 percent in 2018, according to the IMF.
Now, General Motors has issued a statement accusing the Venezuelan authorities of seizing its plant in the industrial hub of Valencia.
"Yesterday, GMV's (General Motors Venezolana) plant was unexpectedly taken by the public authorities, preventing normal operations. In addition, other assets of the company, such as vehicles, have been illegally taken from its facilities," the company said in a statement.
In response, GMV announced the immediate cessation of its operations in the country along with a commitment to pay employees’ separation benefits arising from the termination of the employment relationships due to causes beyond the parties’ control “as far as the authorities permit.”
Reuters has stated that the Venezuelan Information Ministry did not immediately respond to a request for information.
“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,” stated the company.
This is not the first time the Venezuelan government has seized manufacturing assets. In 2014, the government announced a “temporary” takeover of two plants belonging to Clorox Co., which had left the country.
Venezuela is currently dealing with more than a dozen arbitration cases over nationalizations that occurred under the leadership of Hugo Chavez.
Stay tuned for more details.