Venezuelan Conglomerate to Continue Beer Production as Workers Reach Agreement with Coca-Cola

Polar announced that their plants will produce beer throughout the year while Coca-Cola workers will continue to receive benefits despite paralyzed plant production.

By Jeanette Charles
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Workers in Zulia have secured their rights and benefits as Coca-Cola closes plant (Bloomberg).
Workers in Zulia have secured their rights and benefits as Coca-Cola closes plant (Bloomberg).

Caracas, June 3, 2016 (venezuelanalysis.com) – The Venezuelan food and beverage conglomerate Polar confirmed this week that the company will continue beer and malt production throughout the remaining 2016 calendar. In April, President Lorenzo Mendoza announced that the company would cease production alleging insufficient access to US currency to acquire raw materials.

“In light of this situation we have been analyzing how to re-active our production of beer and malt, and finally we have found a temporary solution that will allow us to produce until the end of 2016,” indicated Mendoza.  

Polar will acquire a loan next month from BBVA Provincial Bank of USD$35 million and will use the company’s shares in “Inversiones Banpro International Inc. N.V. Curacao” as collateral, the executive confirmed.   

In an official statement, Polar affirms that the credit “will allow the company to buy barley and hop, raw materials necessary for production... and steel laminates to produce the bottle caps.”

Polar supplies 80% of the Venezuelan beer market and in April closed down four plants, impacting approximately 10,000 employees.

The company will begin to pay back their loan in six months. "It's necessary that the national government garantee a system with access to foreign currency to allow us to fulfill our [loan] obligation," stressed Mendoza. 

President Nicolás Maduro responded to Mendoza's earlier cries for US dollars in April. “Don't worry about [US] dollars, there are none,” Maduro stated. "I told him [Mendoza] not to worry, he has a lot of [dollars] abroad," the Venezuelan president added, calling on Mendoza to use his own finances to sustain Polar's productivity. 

At the same time, Polar has waged a national campaign regarding what they allege as a lack of accessible raw materials via television commercials and laminated posters for businesses in an attempt to legitimate the absence of their products from store shelves.

Coca-Cola Workers Reach Agreement

Meanwhile, workers in Maracaibo, Zulia have reached an agreement with Coca-Cola as the company closed their Femsa Maracaibo-Sur plant in the Venezuelan-Colombian border state in May. The Ministry for the Social Process of Labor presided over the negotiation. 

The union workers’ general secretary Benito José Mambel announced that more than 800 workers will continue to enjoy their benefits including paid vacation time and medical insurance in addition to receiving their regular salaries.

“This is a great achievement for the Coca-Cola workers, but we have not won yet. We believe that our place is in the plant,” Mambel explained.

The agreement will last for thirty days and if the plant remains closed, the agreement will renew itself for an additional month. In addition, the workers, union and company administration created a committee to review the plant’s conditions every two days.

Coca-Cola announced the closing of the Maracaibo plant also citing their lack of access to raw materials in May.