Increased minimum wage closes factory in Vranje

The Kentaur Balkans factory in Vranje has been closed due to the company’s significant deficit and poor labor market projections for this and next year, Mie Krog, CEO of the Danish company Kentaur, said in a written statement to the Slobodna rec portal. Asked why the workers were not informed in a timely manner so that they would have time to adjust, but were simply prohibited from entering the plant the day before, she justified this action by the situation on the labor market in Serbia.

– We had to react quickly to recent changes and projections on the labor market - a drastic increase in minimum wages – the statement reads.

In her response to Slobodna rec, Krog wrote that it was true that the opening of the Kentaur Balkan company several years before had been supported by the Serbian Government, and that it had been “a strong and good cooperation with which they were very satisfied.” Since then, she says, Kentaur A/S has invested significantly in the production facility in the hope of achieving “competitive economies of scale,” but this was not enough to withstand rising costs, and the company is now recording a significant deficit.

She explains that the company hoped to turn around its operations with technical investments and new management, but that this had proved “impossible” due to the development of the labor market in 2025 and projections for 2026.

– We did not see any other option than closure. The decision is very unpleasant. However, we are a private company and we tried to resolve it within our own circle of control. We do not want to rely on public funds to run our daily business. Therefore, we did not involve local or state authorities in making this decision – says Mie Krog in her response.

Around 250 workers at the Kentaur factory in Vranje were informed yesterday morning that they would lose their jobs, without prior notice. The workers who tried to enter the plant were denied entry and were told they could pick up their personal belongings starting Tuesday, October 28. They were greeted by a printed message, without a signature or stamp, stating that the factory’s closure would be carried out “in the course of liquidation,” the portal reminds.

KENTAUR BALKANS DOO

Vlada Republike Srbije

Kentaur AS

Kentaur Balkans Vranje

Mie Krog

closing of Kentaur factory in Vranje