Shares in rigid and plastics packaging business Amcor Limited (ASX: AMC) crashed more than 7 per cent this morning after the company revealed it will take a US$350 write down on its Venezuelan packaging operations.

The write down is being blamed on cumulative foreign exchange translation losses and revisions to the net estimated asset positions of the Venezuelan business as at June 30 2016. Amcor is heavily invested in emerging markets as a growth engine for its overall business globally, but with this geographic reach comes considerable risk as countries like Venezuela can go into economic and political meltdown at short notice.

CNN reports that in Venezuela inflation is set to increase by 481% in 2016 and by 1,642% next year with around one-in-five people unemployed. Venezuela has also been hit hard by the crumbling oil price as its debt levels balloon out of control.

The inflation means the value of the local currency is crashing and causing havoc with Amcor’s operations and financial projections in the country. In response Amcor announced it will adopt a floating exchange rate for Venezuelan bolivars for financial reporting purposes in order to help lessen the potential for further earnings shocks as access to US dollars becomes increasingly restricted.

The company has six rigid plastics plants in the country and expects the troubles there to result in overall profit before tax to be around US$40 million lower for the year ended June 30 2017. Notably it also stated profit after tax will be US$20 million lower for the same period in what looks like a thinly veiled swipe at the socialist tax policies imposed on overseas companies operating in the nation.

The group’s CEO stated that Amcor invests in emerging markets with a ‘long-term view’, although the possibility of pulling out of the country altogether by selling its interests there has probably crossed management’s minds.

After today’s news the shares sell for $15.03 and this short-term blip may represent a buying opportunity for a business with overseas exposure, a market-leading position, and strong track record of dividends and earnings growth.

Amcor is an $18 billion giant in the packaging sector and smaller rival Pact Group Holdings Ltd (ASX: PGH) operates across ANZ and Asia with similar exposure to the thematic of steady demand growth for everyday household goods across emerging consumer markets in particular. Its shares are up 37 per cent over the course of the past year and both packaging businesses retain reasonable growth prospects.

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Motley Fool contributor Tom Richardson has no position in any stocks mentioned.

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The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.