General Motors is halting operations in Venezuela after the country’s plant was seized by authorities Wednesday.
The plant, located in Valencia, was seized amid a severe economic crisis.
GM called the takeover an “illegal judicial seizure of its assets” and vowed to “take all legal actions” as it would damage the company, the plants 2,678 workers, its 79 dealers an its suppliers.
“Yesterday, GMV’s (General Motors Venezolana) plant was unexpectedly taken by the public authorities, preventing normal operations. In addition, other assets of the company, such as vehicles, have been illegally taken from its facilities,” the statement said.
GM said workers would receive separation payments. They added that vehicles and other assets had been taken from its facilities.
Import restrictions and shortages of parts and raw materials has lead to a lack of production in the plant.
Venezuela’s economy is in a severe crisis as unemployment is set to surpass twenty five percent. The country is struggling with a shortage of food and medicine. Hyperinflation has caused the value of its currency to decrease and consumer goods prices to drastically increase.
Several U.S. companies have been cutting operations in Venezuela and pulling out of the country as a result of the inflation and currency control. In 2014,Venezuela’s government announced the “temporary” takeover of two plants belonging to cleaning products maker Clorox.