Venezuela targets drugstore executives in economic crackdown

Venezuela charges two drugstore executives with destabilizing economy, part of a wide-ranging crackdown

Venezuelan authorities have charged two executives of the country’s largest privately owned pharmacy chain with supply “irregularities,” part of a crackdown by President Nicolas Maduro on companies he accuses of causing scarcities of basic household items.

According to a statement released by the attorney general’s office late Wednesday, Pedro Luis Angarita and Agustin Antonio Alvarez, the president and vice president, respectively, of the Farmatodo drugstores, were being held in the headquarters of SEBIN, the Spanish acronym for Venezuela’s intelligence agency, in Caracas.

In addition to the supply accusation, they were charged with destabilizing the economy.

It was not immediately clear what penalties the two executives might face.

Critics say the arrests are meant to deflect the public’s attention from the government’s mismanagement of the economy, which has seen double-digit inflation, a shrinking gross domestic product and long lines at supermarkets and pharmacies for increasingly scarce food and medicine.

In a speech Saturday, Maduro blamed the drugstore chain for the lines, accusing it of “guerrilla tactics” such as understaffing stores. He said it’s part of an economic war allegedly being waged by private businesses against his socialist government.

In a statement issued Sunday, Farmatodo denied wrongdoing, saying its policies are “known and transparent.” The chain also said it had undergone 60 inspections by government officials last month.

Because of falling productivity in recent years, the Venezuelan economy relies heavily on imported goods to satisfy consumer demands. But a 50% decline in the price of oil, the mainstay of the economy and the primary source of state revenue, has meant less cash for the government to buy foreign-produced food and medication. That in turn has caused shortages  and long lines, critics say.

The government manages the importing of food items, medications and the raw materials used in the Venezuelan manufacture of retail drugs sold in privately owned chains such as Farmatodo. Many of the drugs and drug components are imported from Cuba.

The two executives were detained for questioning Saturday along with five other Farmatodo officials who have since been released. According to the government's statement, Angarita and Alvarez were formally charged with “irregularities in the distribution of products of the highest necessity.”

The government, however, is not expected to nationalize the 167-store Farmatodo chain, as it has done with other retailers, most recently the Dia a Dia grocery chain seized on Monday. National Assembly President Diosdado Cabello said that takeover was prompted by “long lines denounced by the people.”

Jorge Roig, the head of Venezuela’s largest business federation, told the news service that the arrest was part of a government campaign to destroy the private sector.

“This is the total and exclusive persecution of private business, aimed at putting an end to it,” Roig said.

Mogollon and Kraul, who reported from Bogota, Colombia, are special correspondents.

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