Italian tyre maker Pirelli has closed down its car tyre factory in Guacara, Venezuela, and has ceased all activities in the country after 28 years. Previously, the plant had temporarily shut down after the Venezuelan economic reforms.
The decision comes as the country descends into a spiral of hyper-inflation with inflation projection reaching a staggering million per cent by year endand asa great number of its population attempts to escape the economic conditions by fleeing to neighbouring countries.
“Pirelli announces the disposal of its car tyre factory in Venezuela, located in the city of Guacara and all the activities held in the country,” said a statement from the Italian supplier.
“The operation follows the de-consolidation of the Venezuelan subsidiary which took place on December 31, 2015 and has no financial effects on the group.”
The agreement, which calls for employment continuity, was reached with a consortium of South American entrepreneurs and the company Sommers International, in the capacity of buyer.
Venezuela sits on20% of the global oil reserves, but its currency is swiftly devaluing, triggering a huge economic crisis.