US Reporter

After 32 years, McDonald’s depart from Russia

Source: NewsNation

In 1990, McDonald’s became the first restaurant in the Soviet Union. The line went around the block, and hundreds of people had gathered to get a taste of Big Mac – one of the restaurant’s oldest and most famous creations.

One woman said that she lined up outside the fast-food chain store because they were all hungry in the city. She added, “We need more restaurants and stores like these [since] there is nothing in our stores or restaurants.”

The meal at McDonald’s had cost about half a day’s wage. But people lined up for it and said it’s unusual but ‘delicious.’ Mcdonald’s then ended their day serving over 30,000 customers – a big achievement for an American company inside the Soviet Union.

Now, the company will close its doors to customers in the country after 32 years, following the continued siege of Russia against Ukraine. The restaurant emptied out Russian stores due to the continued attacks on Russia’s neighboring affecting many Ukrainians and Russians alike. 

The people of Russia were not happy when they heard that McDonald’s would be closing down its 800 stores. A man even handcuffed himself outside one location, arguing with employees and telling them how much he was surprised by the decision. “Closing down is an act of hostility against me and my fellow citizens,” he said.

“To a generation of Russians, McDonald’s — commonly referred to as MakDak — was a fascinating phenomenon.”

Bakhti Nishanov, Eurasia specialist

Nishanov said that McDonald’s holds a great symbolic representation in the history of Russia. He recounts that the company’s entry to Russia, at the time still part of the Soviet Union, meant that the country was already fit for running a business, and it was open for more investments. “The company leaving Russia is an explicit signal that the country is no longer a place you want to be in as a business,” he said.

The company’s exit upsets its symbolic representation and has also practically laid off over 62,000 people across Russia. With other companies departing from the country due to conflicts, there are fewer jobs available in Russian industries.

The company management stated that the “humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald’s values.” They have also announced the selling of their 847 restaurants in the country.

McDonald’s CEO, Chris Kempczinski, said that the decision was ‘extremely difficult’ on their part. However, he assures employees they will still get paid until a buyer assumes assets in Russia. McDonald’s reports that its exit from Russia will cost them up to $1.4 billion dollars, which, if combined with Ukraine’s, represents 9% of the total revenue of the country.

“McDonald’s leaving Russia hits many of my generation differently,” Nishanov said, “I think because it represented — and I know this sounds dramatic —  hope and optimism. The company leaving confirms Putin’s Russia is a place devoid of those two things,” he concluded.

Opinions expressed by US Reporter contributors are their own.