Local Authorities Willing To Give Kraft Larger Land To Keep Business In Romania

"I had a talk yesterday (Thursday – e.n.) with union leaders at Kraft, who asked me to step in and help them avoid losing their jobs. They said the main argument why Kraft said it will shut down the chocolate factory is that it’s located in the center of the city and they don’t have enough space. If space is the problem, the mayoralty is willing to give them a larger plot of land in the city,” Brasov mayor George Scripcaru told MEDIAFAX Friday.

Kraft Foods Romania said Wednesday it will shut down its chocolate factory in Brasov and will relocate activity to other units. The unit in Brasov is the only one Kraft owns in Romania, and has about 440 employees.

"The shutdown has nothing to do with the international crisis. Sales increased a lot in Romania in recent years and we needed to up our production capacity, but possibilities in Brasov were limited in terms of space, as the factory is in the city center and expansion was not an option, so we decided to up production in other factories the group owns,” Doina Cavache, corporate affairs manager at Kraft Foods Romania, told MEDIAFAX Wednesday.

She added production will be relocated gradually, until the end of next year, including in the groups’ factory in Bulgaria.

The mayor said he expects the company management to come for talks on the matter to look for ways to keep the factory in business.

"We can find solutions if space is really the issue,” the mayor said.

He added the company never required a larger plot of land from local authorities.

Unionists told the mayor they will soon start negotiations with management over severance pay.

As for the company’s local brand, "Poiana", the mayor said it is in close connection with the city, adding he would do his best to keep it there.

"Poiana was a brand before Kraft started operations and used and capitalized it. I will look into the legal status of this brand and I’ll do everything legally possible to keep it in Brasov,” Scripcaru said.

The company entered the Romanian market in 1994, when Kraft Foods International bought the local candy factory in Brasov, Poiana Produse Zaharoase.

Kraft Foods has annual revenues exceeding $37 billion, and employs over 100,000 people in 180 production units worldwide.