Venezuela: Cost of beer production up by 6,500 percent because of lack of resources and federal minimum wage increase

The National Federation of Distillers of Venezuela has attributed a 6,500 percent increase in the cost of beer production to a lack of resources and a federal minimum wage increase, UPI.com reported on September 19.

In many Venezuelan states, the price for a case of beer has nearly tripled since April, according to Franklin González, president of the distillers group, El Tiempo reports.

Venezuelan brewers import large quantities of raw materials to make beer, and the introduction of a new currency exchange system earlier this year, as well as President Nicolas Maduro's most recent minimum wage increase of 50 percent in August, have caused the cost of producing beer to skyrocket - meaning prices have also gone up.

"Sales are down 70 percent to 80 percent in some places and that's terrible for all of us," Gonzalez said.

One of Venezuela's most famous rums, Cacique, is cheaper than its volume-equivalent in beer. Gonzalez said retailers that once sold more than 100 cases of beer a week are now selling less than 15. At least 30 liquor stores have closed since Maduro's latest minimum wage increase, Gonzalez added.

Venezuela's economic crisis, which was exacerbated by a decrease in oil prices, has led to a shortage of basic goods - including food and medicines. Maduro's regime has taken various steps, such as ordering the military to take control of five ports as part of "war strategies" to provide food and medicine amid the economic crisis.

Empresas Polar, one of Venezuela's largest corporations, recently said production of food has fallen 30 percent so far in 2016 because of a shortage of corn, wheat and rice.

20 September, 2016