Anti-Israel Boycotts Hurt KFC and McDonald’s in Middle East

US fast food chains McDonald’s and KFC are facing major challenges in Asia and the Middle East due to boycotts related to their perceived links to Israel. Many consumers in these regions have altered their consumption habits since the genocide in Gaza began, significantly reducing demand for these brands.

Impact on Big Brands

McDonald’s faced backlash after social media showed its Israeli franchises providing meals to soldiers following the October 7 attack in Gaza. This led to widespread boycotts across the region, with Egypt, Jordan, and Morocco being particularly affected. McDonald’s CEO Chris Kempczinski noted the most pronounced impact was in the Middle East and Muslim-majority countries like Indonesia and Malaysia.

Regional and Global Repercussions

KFC has also been hit hard, especially in Southeast Asia. Over 100 KFC outlets in Malaysia were temporarily closed due to boycotts. In Pakistan, local brands have gained preference over Coca-Cola and Pepsi, with posters labeling these multinational companies as linked to Israel.

Sales Decline and Store Closures

Pakistan Aluminum Beverage Cans reported an 11% drop in sales for the quarter ending March 31, partly due to decreased domestic demand linked to the Middle East unrest. In North Africa, KFC’s first store in Algeria was temporarily closed amid nationwide protests in April.

Varied Impact Across Europe

In Europe, the effects of the boycotts are less clear due to diverse public opinions. AmRest Holdings, a major fast food operator in Europe, noted that the conflict in the Middle East could affect consumer confidence and spending patterns. In France, McDonald’s CEO Kempczinski acknowledged a "meaningful" impact, suggesting that McDonald’s and Starbucks may take until the end of the year to recover fully from the setbacks.

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