Polar’s beer will be back on shelves
Good news for thirsty Venezuelans. The country’s major brewer Polar will resume beer production in the first week of July 2016, having secured a loan that will enable it to purchase the necessary raw materials.
While Polar’s smaller rival brewer – Regional – managed to obtain forex and has continued its beer production, Polar had to shut down its four plants in late April, laying off 10,000 workers, because of a barley shortage. It said it was unable to import the key ingredient as it could not access dollars under socialist President Nicolas Maduro’s tight currency controls.
As bars and shops ran dry, Polar negotiated a USD 35 million loan from the Spanish bank BBVA, putting up its shares in an investment fund as collateral.
The cash will enable the company to buy barley, hops and steel sheets for cans – enough to resume production next month and get through the rest of 2016, Polar said on 2 June 2016.
However, this loan must be repaid in six months and the only way to do this is that the government ensures access to foreign exchange.
Polar Breweries is part of Venezuela’s largest corporation, Empresas Polar, whose chief executive, Lorenzo Mendoza, has repeatedly clashed with President Maduro as the economy has veered into a deep recession.
President Maduro accuses the billionaire businessman of sabotaging the economy by slowing production, which the leftist leader blames for severe shortages of food and basic goods.
The president also declared a state of emergency in May to counter what he calls a U.S.-backed "economic war" on Venezuela, threatening to arrest the owners of businesses that halt production.
Although Venezuela sits on what must be the world’s largest oil reserves, the sharp fall in global crude prices over the past two years has exacerbated the decline of its socialist economy.
With its main source of foreign currency collapsing, the cash-strapped government is unable to meet businesses’ demand for the dollars they need to buy goods and materials abroad.
Media say the import-dependent economy is set to contract eight percent this year, with inflation rising to 700 percent, the International Monetary Fund forecasts.
