All government grants that Geox has received
Reduced prices at the company’s store, and workers told they are on paid leave until the end of July, sparked speculation last week that the Geox shoe factory in Vranje was closing and the company Italian, who arrived five years ago, was about to relocate production to another country.
However, no official confirmation has been made by the Ministry of Economy, the mayor of the municipality of Vranje or the Tehnik Development Company, under which Geox operates in Serbia. Unofficially, the unions say Geox is only interested in receiving additional grants in this situation, just as it did two years ago, when it received an additional two million euros in a similar crisis situation.
Upon his arrival in Vranje, the state gave Geox 11.2 million euros, as well as 100 million dinars to finance the process of preparing the ground for their production plant. According to the decrees adopted by the city council of Vranje, the Italian company received free land with an area of 110,751 square meters, worth 555,000 euros.
Geox also received just under 14 million euros in 5 years, if we take into account the initial donation of the land, as well as the two million it received two years ago. Over the five years, according to financial statement data, Geox spent 4.9 billion dinars or 42.2 million euros on salaries.
Thus, one in three salaries paid by Geox was in fact financed by the state. Labor costs have exceeded one billion dinars per year and it was not until the first year, in 2016, when the company started production, that a total of 760 million dinars was spent on wages.
For the first three years of full operation, Geox in Vranje recorded good results and the net profit in 2017 was 350 million dinars, 242 million in 2018 and 117 million in 2019. However, last year did not was good for Italians, who annually produce 20 million pairs of shoes in the world, as the Serbian branch of Geox ended 2020 with a loss of 130 million dinars.
At the same time, the positive financial results coincide with the amount of grants, contributions and donations that Geox has received from state authorities, which for the first four years amounted to more than 200 million dinars per year. The first year, in 2016, the state allocations amounted to 209 million dinars or about 1.8 million euros, the following year they amounted to 208 million, 205 million in 2018 and in 2019 , 201 million dinars.
This article is also available in: Italiano