Venezuela’s beer industry is under threat, according to the country’s Chamber of Beer Manufacturers. The group’s Executive Director, Omaira Sayago, has warned that the delay in granting import permits and the $217 million debt to foreign suppliers will shortly bring brewing to a standstill.
“At current production levels, if supplies are not replenished we will only be able to continue operating until the beginning of August,” said Sayago.
Venezuelans have the eighth highest beer consumption per capita in the world. But the industry is now said to be operating with historically low levels of materials — in particular malted barley, bottle caps, crates, aluminum and other usually imported supplies.
Sayago explained that Venezuelan breweries have gone through difficult situations over the decades, but a solution had always been found. Even with exchange controls and economic difficulties in previous years, “the foreign currency needed to pay suppliers was always provided,” she said.
If production does come to a standstill, it would not be a quick process to resume normal service. If breweries are inactive for three weeks, it will take them 16 weeks to start selling the final product upon receiving supplies once again. In an attempt to avert a crisis, beer producers have called for an urgent meeting with the government.
Breweries are said to be operating at maximum output and the Chamber of Beer Manufacturers has announced it will make a proposal to the authorities to “refinance” the debt with suppliers so as to avoid an end to production.
“We are confident that the government will understand the importance of this situation,” said Sayago.
There are eight beer plants in the county and the industry generates 12,000 direct employment positions. While beer has been produced in Venezuela for more than 170 years, raw materials have always needed to be imported.
This is not an isolated case, as many Venezuelan food and medicine industries are also in debt to their suppliers. Meanwhile, with large-scale political instability and dropping oil prices, the country’s economy has been struck by a crippling recession since last year — meaning beer in which people can drown their sorrows is more needed than ever.