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Pro-Palestinian Boycotts in Indonesia Impact KFC's Financial Performance

2024-08-12 05:07:23.536000

Assailants in Iraq have targeted several U.S. and American-style food chains, including KFC and Lee’s Famous Recipe Chicken, as part of an “economic boycott” of brands they say help fund the Israeli military’s actions in Gaza. The attacks began in late May after Iran-backed Shiite militias called on their followers to protest the businesses. The militias claim that the profits from these businesses are funneled to Israel and its armed forces. In response to the unrest, the Iraqi government has deployed U.S.-trained counterterrorism units across Baghdad to protect foreign investors and signal control over pro-Iran groups. Similar protests against American brands have occurred in the Middle East and globally in the past. Shiite militias loyal to Iran hold significant political and military power in Iraq and have long opposed the U.S. military presence in the region. The attacks on popular burger and fried chicken joints in Baghdad have surprised many observers. The Iraqi government has apprehended suspects believed to be involved in the attacks, but some analysts argue that the response has targeted low-ranking militia members without addressing the senior network. The attacks have raised concerns among business owners in Baghdad, and some restaurants with foreign-sounding names have clarified that they are local businesses with no ties to U.S. corporations. Iraqi security forces are now guarding the targeted premises and franchises. The aim of these attacks is to promote a boycott of American brands and deter their presence in the country. The US Ambassador to Iraq has condemned the attacks, and the US State Department has called on the Iraqi government to respond and hold those responsible accountable. The Iraqi government has already arrested some suspects and is actively searching for others. The security spokesperson has warned that anyone who threatens the country's security and economic well-being will be pursued [383bcc27] [446ca62b] [a6dab87e].

Meanwhile, in Indonesia, pro-Palestinian boycotts have had a significant impact on the financial performance of Kentucky Fried Chicken (KFC) Indonesia. KFC Indonesia, owned by Fast Food Indonesia, reported a net loss of 348.83 billion rupiah (US$21.5 million) in Q1 2024, a substantial increase from a loss of 5.56 billion rupiah (US$343,825) in the same period last year. The boycotts began during the war in Gaza in October 2023 and targeted brands perceived to be associated with Israel, including McDonald's and Starbucks. The boycotts have also affected other Western food and beverage outlets in Indonesia. In response, KFC Indonesia has implemented more promotions and discounts to attract customers. The impact of the boycotts can be seen in the drop in share prices of products affiliated with Israel and the US and the financial performance of these companies. The boycotts have negative effects on the local economy, including sales of micro, small, and medium enterprises that distribute Israeli-American affiliated products [6e951d47].

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