February 5, 2015 / 12:48 PM / in 3 years

Venezuela arrests pharmacy chain owners in 'economic war'

CARACAS (Reuters) - Venezuela has arrested two bosses of a major pharmacy chain accused of exacerbating long shopping lines in what President Nicolas Maduro calls “an economic war” underway in the recession-hit OPEC nation.

Farmatodo’s executive president Pedro Angarita and operations vice-president Agustin Alvarez were picked up for questioning at the weekend and formally charged on Wednesday, the attorney general’s office said in a statement.

For months, many of the chain’s 167 stores, which sell food and hygiene products as well as medicines, have seen huge lines of shoppers outside amid scarcities of basic products that have plagued Venezuela for two years and worsened this month.

Maduro’s critics say Venezuela’s economic troubles are man-made, with 15 years of hardline socialism to blame, especially nationalizations and currency controls that leave importers struggling for dollars.

The government, though, blames opposition leaders and unscrupulous businessmen - encouraged by the United States and foreign media - for attacking the economy via hoarding, smuggling, price-gouging and provoking lines.

The oil-dependent economy shrank 2.8 percent and had inflation of 64 percent last year, the worst performance in Latin America. Given the oil price slide has slashed revenues by half, most economists predict further contraction in 2015.

The two arrested Farmatodo executives were specifically accused of “boycott” and “economic destabilization”.

“Last Saturday, officials ... inspected a pharmacy of that chain in Los Ilustres Avenue, in Caracas, where they found that various checkouts were not operating while a large line of people waited to pay for their products,” the statement said.

There was no immediate response from Farmatodo to the charges, though it did issue a statement on Monday saying its 96-year history in Venezuela was legal and transparent.

“Our main aim is the timely supply of medicines and basic products to ... the more than 2.5 million customers and patients who visit us weekly,” it said. “We will continue serving our customers with our characteristic professionalism.”

The move against Farmatodo came as Venezuelan authorities also took over 35 stores belonging to the “Dia a Dia” (Day to Day) supermarket chain this week on charges it hoarded food to stoke public exasperation over shortages.

Opposition leaders say the government’s high-profile crackdowns on those companies will further cow private businessmen in Venezuela and worsen the shortages.

“Farmatodo has been a model of successful private effort, the consequences go beyond that chain, they’re finishing off the little that remains,” opposition leader Henrique Capriles said.

Writing by Andrew Cawthorne; Editing by Chizu Nomiyama

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