Trucks lined up at a Oaxaca blockade. Trucks lined up at a Oaxaca blockade.

Walmart mulls an exit from state of Oaxaca

Business group estimates economic costs of Oaxaca protests are now 1.7 billion pesos

With 70 semi-trailers full of goods stranded by roadblocks and its 37 stores running out of inventory, Walmart México is contemplating an exit from the state of Oaxaca, where business leaders say losses are now more than 1 billion pesos.

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Fifteen stores operating in remote communities under the Mi Bodega brand are the most likely to close first, said the firm’s corporate communications director, Antonio Ocaranza.

At present, all stores are operating with the exception of the Mi Bodega Aurrerá in Putla de Guerrero, which has been behind a blockade since June 16, and the Bodega Aurrerá in Juchitán, which has been closed for lack of security.

The inventory situation is no better in Chiapas, said Ocaranza, where the company has 51 stores.

Adding to the company’s supply problems is the fact that many of the truck caught in blockades have now run out of fuel, presumably because the engines had to be kept running to operate cooling systems.

Interior Secretary Miguel Ángel Osorio Chong met with Oaxaca business leaders earlier this week. They say sales are down 80% as a result of more than two weeks of highway blockades by members of the CNTE teachers’ union and their sympathizers, and thousands of jobs are on the line.

The economy “is collapsing,” warned Benjamín Hernández Gutiérrez, president of the employers’ group, Coparmex.

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The hotel occupancy rate in the city of Oaxaca was just 5% per cent this week and the tourism sector alone is losing an estimated 1.7 million pesos, or US $92,000, a day, prompting businesses to call on teachers to consider the rights of the majority of Oaxaca residents.

Business Coordination Council president Juan Pablo Castañón recognized that the rights of the demonstrators must be respected, but they in turn must respect the rights of others, “those who go to work every day, those who take their children to school, or go to the markets to buy food for their families.”

Castañón said the economic cost of the blockades now exceeds 1.7 billion pesos.

The National Human Rights Commission has issued a similar plea regarding the rights of citizens, calling on the protesters at the blockades to allow the free movement of vehicles and supplies to avoid shortages that negatively affect people’s lives.

The commission also pointed out that the less fortunate in society are among those who are particularly at risk due to the blockades. The rights of freedom of expression and peaceful protest should not negatively affect the rights of third parties, it said in a statement.

In other news of the conflict:

• The CNTE stepped up their mobilization in the city of Oaxaca this morning, blocking access to the shopping centers Plaza del Valle and Plaza Oaxaca.

• A roadblock went up again yesterday at Hacienda Blanca on federal highway 190, the principal entry to the city of Oaxaca for traffic from Mexico City.

• Grupo Modelo, the brewer of Corona beer and other popular brands, told clients yesterday it was suspending activities indefinitely in Oaxaca city due to a shortage of raw materials needed for beer production and the company’s inability to distribute products due to blockades.

• The situation in Oaxaca today is worse than it was 10 years ago when the city was rocked by social upheaval that cost at least 17 lives, said Onésimo Bravo, president of the restaurants association, Canirac.

Source: Expansión (sp), EFE (sp), NVI Noticias (sp)

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  • PintorEnMexico

    A high volume, low margin enterprise like Walmart depends upon operational efficiency to stay in business. Disruptions to the supply chain are catastrophic. It’s not easy to turn off the tap without effecting things way upstream. I’m no fan of Walmart in general. Unfortunately, a US company withdrawing from the south would reward and embolden CNTE and would forever be the subject of their “bloqueo corridos….”

  • Beau

    The Government lack of action is due to the recent scandal of the missing Ayotzinapa students, plus they are terrified of creating another Tlatelolco massacre scandal. The world is watching..

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