In Indonesia and Malaysia, boycotts hammer McDonald’s, Starbucks | Israel War on Gaza

Medan, Indonesia – Ordinarily during the holy month of Ramadan, entrepreneur Putra Kelana breaks fast with his family and friends at several different food outlets across his city in North Sumatra.

 But this year, one outlet will not be on the menu: McDonald’s.

Kelana has been boycotting the fast food chain since October when McDonald’s Israel announced on social media that it had donated thousands of free meals to the Israeli military amid its war in Gaza.

“It is not so much an outright boycott, rather a feeling of being deeply unhappy with Israel,” Kelana told Al Jazeera.

“I used to have a McDonald’s sticker on my car which gave me discounts when I used the drive-through, but I ripped it off when the war started.”

“If I could go to Gaza to help fight against the Israeli forces, I would do it. Muslims are being killed by the Israelis every day. Because I can’t go there in person, the next best thing is to show my support by not using products affiliated with Israel.”

Kelana, who joined a Whatsapp group where members regularly post updated lists of products to avoid, has also stopped drinking Aqua bottled water following reports that French producer Danone invested in several Israeli companies and startups.

Across Southeast Asia, calls to boycott products perceived to have links to Israel are having a noticeable impact on the bottom lines of major brands.

In February, McDonald’s said that war was part of the reason international sales rose by just 0.7 percent during the fourth quarter of 2023, down sharply from a 16.5 percent expansion during the same period the previous year.

“The most pronounced impact that we’re seeing is in the Middle East and in Muslim countries like Indonesia and Malaysia,” McDonald’s CEO Chris Kempczinski said in an earnings call.

“So long as this conflict, this war is going on […] we’re not expecting to see any significant improvement.”

Other brands that have been affected by boycotts include Unilever and coffee chain Starbucks.

Unilever, which produces Dove soap, Ben & Jerry’s ice cream and Knorr stock cubes, said in February that sales in Indonesia had experienced a double-digit decline during the fourth quarter last year as a result of “geopolitically focused, consumer-facing campaigns”.

Isna Sari, a housewife in Medan, said she has made several changes to her weekly shopping list since the start of the war, including switching washing up liquid brand Sunlight, owned by Unilever, for local brand Mama Lemon.

“I have also started buying Ciptadent toothpaste instead of Pepsodent, which is also owned by Unilever,” she told Al Jazeera. “Not only do these products not support Israel but they are also cheaper.”

“My reason for making these changes is that I don’t want to give my money to any company that does not support Palestine.”

Despite being targeted over their purported ties to Israel, the companies taking a hit in many cases have tenuous links to the country.

While McDonald’s franchisees must pay a fee to the fast-food giant’s United States headquarters, most outlets, including those operated by McDonald’s Israel, are locally owned.

McDonald’s franchisees in many Muslim-majority countries, including Saudi Arabia, Oman, Kuwait and the United Arab Emirates, have expressed support for Palestinians and pledged money to support relief efforts in Gaza.

Danone Indonesia, which operates 25 factories with 13,000 employees in Indonesia, has denied any “connection or involvement in political views” related to the war and last year announced that it had donated 13.3 billion Indonesian rupiahs ($846,000) in humanitarian aid for Palestinians.

Unilever Indonesia in November said that it was “sad and concerned” about the conflict and that its products were “made, distributed and sold by the people of Indonesia”.

Starbucks Indonesia, like other international branches of the brand, is owned by a local company, PT Sari Coffee Indonesia.

Nonetheless, brands’ efforts to distance themselves from the war continue to fall on deaf ears.

At a branch of Starbucks in Medan, an employee who wished to remain anonymous said that business during Ramadan had been slower than last year, despite promotions offering free drinks for breaking fast.

“This is the first year we have changed our opening hours during Ramadan from 10am to 12pm. We now close at 8pm instead of 10pm because business is so slow. We have never done that before,” the employee told Al Jazeera.

In Malaysia, Starbucks franchisee Berjaya Food reported a 38.2 percent drop in revenue in the fourth quarter of last year, which it “attributed to an ongoing boycott”.

In March, Berjaya’s founder, Vincent Tan, called for an end to the boycott, saying that Starbucks Malaysia is owned and staffed by Malaysians and that “in stores, 80 to 85 percent of employees are Muslims”.

“This boycott doesn’t benefit anyone,” Tan said.

McDonald’s Malaysia, owned by Gerbang Alaf Restaurants, last year filed a lawsuit against Boycott, Divestment and Sanctions (BDS) Malaysia accusing the movement of damaging its business by falsely linking it to Israel’s war in Gaza.

Back in Medan, Kelana said he misses McDonald’s Ramadan menu, which includes special promotions for breaking fast, including fried chicken in curry sauce, rice, sweet tea and ice cream.

Still, he is steadfast in his commitment not to give the food chain any money.

“It doesn’t have to be drastic, we just need to do what we can,” he said. “We can affect change through our families by choosing the things we buy, which can be difficult because we tend to buy products out of habit.”

“Who doesn’t like McDonald’s? Especially the special sauce. But we can live without it.”