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McDonald's face Belarus ban threat

By Mikhail Vanyashkin, Transitions Online

MINSK, Belarus -- The McDonald's fast food chain could be blocked from expanding in Belarus if local authorities in the capital Minsk have their way.

Nikolai Yerokhov, the first deputy chairman of the Minsk City Executive Committee, suggested that McDonald's should be barred from buying property because of "the state's concerns about the nation's health and the promotion of domestic food products."

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Local newspapers quoted Yerokhov as saying that "this overseas kind of food is unhealthy and even risky."

But McDonald's hit back at the accusation saying all its food and hygiene standards met Belarus standards. A spokesperson for the chain, which has six outlets in Minsk, said: "Regular checks by the city's sanitary authorities confirm that our products meet Belarusian quality standards."

The company said that about 70 percent of its food arrives from McComplex, the processing and distribution centre in Moscow, which in turn buys raw ingredients from Russian suppliers.

"We only use ingredients that fully meet the highest standards of quality and safety," a company statement read.

Yury Fyodorov, first deputy chief of the Health Ministry's National Hygiene and Epidemiology Centre, which examines food quality, told Belorusskaya Gazeta that his agency has never been asked for findings about McDonald's cuisine and has not recommended any bans.

"Their menu is not in line with Belarusian traditions, but that does not mean that the food is harmful," Fyodorov said.

Belarusian national cuisine is known mainly for draniki -- potato pancakes, sometimes stuffed with sausage, served with sour cream.

Another popular national food is pork fat called salo, often served in a fried form called shkvarki.

The first three McDonald's restaurants opened in Minsk on December 10, 1996. One of them is just 100 metres from the office of Belarusian President Alexander Lukashenka, who has to pass the establishment almost every day when commuting from his country residence to the city.

Lukashenka has repeatedly pushed his government to establish an alternative Belarusian-style fast-food chain to compete with the hamburger retailer.

So far, two such cafes -- called Khutkaye Kharchavanne, Belarusian for "fast food" -- have opened in Minsk.

Despite their prime locations, the two restaurants are generally far less busy than the McDonald's outlets, though the multinational chain insists that competition with McDonald's is not the reason for Khutkaye Kharchavanne's slack performance.

McDonald's spokesperson Volha Trayan said: "McDonald's has competitors in all countries in the world, and there is space for all."

In its media release, McDonald's said that the company is one of the largest foreign investors and taxpayers in Belarus, having invested more than $14 million in five years in its Minsk restaurants, which it said employ 800 people and serve 25,000 customers daily.

Belarus is 135th in the Euromoney country risk rankings. In 1989-1999, the cumulative foreign direct investment in Belarus was $68 per capita, compared with $1,925 in Hungary, $1,392 in Estonia, $862 in Latvia, and $817 in Poland.

Foreign direct investments in Belarus totalled $43.9 million in the first nine months of 2001, 40 percent down from the same period in 2000.


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