Out of Cardboard, Another Colgate Plant Shuts Down in Venezuela

(Bloomberg) -- A Colgate-Palmolive plant in Valencia, Venezuela, stopped operating this week due to a shortage of cardboard needed for packaging, said Carlos Rodriguez, an employee union leader.

The plant, which produced liquid detergent, fabric softener and dishwasher soap, required cardboard to transport company products to stores, supermarkets and pharmacies. The shortage worsened after the government took over control of paper and packaging manufacturer Smurfit Kappa’s Venezuelan operations there earlier this year. This is the second out of five production plants to close in the country, Rodriguez said.

Colgate is just the latest international company to partially or completely close shop in the troubled and chaotic nation, following others such as Kellogg Co. and Kimberly-Clark. Poor access to raw materials, price controls and a lack of dollars to import goods are among the barriers that corporations face in Venezuela. A local Colgate representative didn’t respond to requests for comment.

©2018 Bloomberg L.P.