After Russia targets McDonald's, businesses wonder who's next

Thu Aug 21, 2014 8:55am EDT
 
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By Polina Devitt and Alissa de Carbonnel

MOSCOW Russia (Reuters) - Russia said on Thursday it was investigating dozens of McDonald's (MCD.N: Quote) restaurants, in what many businessmen said was retaliation for Western sanctions over Ukraine they fear could spread to other symbols of Western capitalism.

Russia's food safety watchdog said it was looking at possible breaches of sanitary rules at McDonald's, but many in the business community said it was a reflection of the deterioration in relations between Russia and the West over Ukraine, where pro-Russian separatists in the east of the country are fighting against government forces.

"Obviously, it's driven by the political issues surrounding Ukraine," said Alexis Rodzianko, President and CEO of the American Chamber of Commerce in Russia.

"The question on my mind is: Is this going to be a knock on the door, or is this going to be the beginning of a campaign?"

Russia earlier this month slapped bans on Western food imports after Washington and Brussels imposed economic sanctions in response to Moscow's annexation of Ukraine's Crimea region and its backing of the separatists.

In a sign of growing frustration at the threat to trade, several mid-tier Russian businessmen signed off on a letter by British entrepreneur Richard Branson calling on politicians to stop the conflict.

"We, as business leaders from Russia, Ukraine and the rest of the world, urge our governments to work together to ensure we do not regress into the Cold War misery of the past," the letter said.

McDonald's, which opened its first store in Russia in the dying days of the Soviet Union in 1990, is a very visible symbol of American capitalism in Russia, where it now has 438 branches.   Continued...

 
A man walks past a closed McDonald's restaurant, one of four temporarily closed by the state food safety watchdog, in Moscow, August 21, 2014. Russia ordered the temporary closure of four McDonald's restaurants in Moscow on Wednesday, a decision it said was over sanitary violations but which comes against a backdrop of worsening U.S.-Russian ties over Ukraine. REUTERS/Maxim Zmeyev