McDonald’s announced yesterday it had closed its restaurants in Crimea, prompting fears of a backlash as a prominent Moscow politician called for all the US fast food chain’s outlets in Russia to be shut.
Crimea’s annexation by Russia, which Ukraine and the West do not acknowledge, has worried companies with assets in the Black Sea peninsula as it is unclear how the change may impact their business.
While McDonald’s did not mention the political situation in its statement, its decision to leave the region is likely to be seen as emblematic of the rift in Western-Russian relations, now at their lowest ebb since the end of the Cold War.
“Due to operational reasons beyond our control, McDonald’s has taken the decision to temporarily close our three restaurants in Simferopol, Sevastopol and Yalta,” a spokeswoman said.
The Crimean outlets are not franchises, but owned and operated by McDonald’s itself.
Fast food chain to relocate staff to work in mainland Ukraine
The closures follow Geneva-based Universal Postal Deutsche Post’s announcement that it was no longer accepting letters bound for Crimea as delivery to the region was no longer guaranteed.
Economic relations between Russia and Ukraine have worsened since Russia annexed Crimea last month in response to the ousting of Russian-backed president Viktor Yanukovych after months of street protests in Kiev.
Targeted sanctions imposed on a number of prominent Russians by the US and the EU have alarmed some foreign investors.
Russia raised the price it charges Ukraine for gas on Thursday for the second time this week, almost doubling it in three days and piling pressure on its neighbour as it teeters on the brink of bankruptcy.
European customers are now concerned Russia might again cut off deliveries as Moscow has frequently used energy as a political weapon against its neighbours.
Moscow is applying economic pressure in other areas, while Ukraine has responded.
Russian riot police last month took control of a factory belonging to a Ukrainian confectionery magnate in the city of Lipetsk as part of an investigation into the company’s affairs, the Ukrainian government has said.
Petro Poroshenko, a billionaire oligarch known as the “Chocolate King”, is the front-runner in Ukraine’s presidential election, which is set for May 25.
Ukraine this week temporarily prohibited seven Russian food companies from selling some of the products they manufacture on Ukrainian territory.
McDonald’s said it hoped to resume work as soon as possible but said it would help relocate staff to work in mainland Ukraine, signalling it did not expect its Crimean businesses to reopen in the near future.
The company’s decision was welcomed by the deputy speaker of the Russian Parliament, Vladimir Zhirinovsky, well known for his anti-Western rhetoric, who has demanded that McDonald’s pull its business out of Russia entirely.
“It would be good if they closed here too... if they disappeared for good. Pepsi-Cola would be next,” Russian media quoted Zhirinovsky as saying.