McDonald's shuts 300 restaurants in China as coronavirus spreads
McDonald’s has closed hundreds of restaurants in China and added its name to the list of global companies bracing themselves for the impact of the coronavirus outbreak, amid signs of a mounting economic effect alongside the human cost.
The fast food chain said it had shut about 300 restaurants and set up a epidemic task force in response to the virus, which has killed 132 people and infected more than 6,000, particularly in Wuhan, the capital of the Hubei province.
Although McDonald’s didn’t open a restaurant in mainland China until 1990, the country has become one of its largest and fastest-growing markets, with about 3,300 restaurants and 1,500 more planned by 2022.
Its operations in the country make up nearly a tenth of its worldwide restaurant count, nearly 5% of sales and 3% of operating profit.
“China is a critical market for us and we’re very concerned about the situation over there,” said the chief executive, Chris Kempczinski, although he said the overall impact on profits would be fairly small if the virus remained relatively contained.
The World Health Organization is recommending that people take simple precautions to reduce exposure to and transmission of the Wuhan coronavirus, for which there is no specific cure or vaccine.
The UN agency advises people to:
Frequently wash their hands with an alcohol-based hand rub or warm water and soap
Cover their mouth and nose with a flexed elbow or tissue when sneezing or coughing
Avoid close contact with anyone who has a fever or cough
Seek early medical help if they have a fever, cough and difficulty breathing, and share their travel history with healthcare providers
Avoid direct, unprotected contact with live animals and surfaces in contact with animals when visiting live markets in affected areas
Avoid eating raw or undercooked animal products and exercise care when handling raw meat, milk or animal organs to avoid cross-contamination with uncooked foods.
Despite a surge in sales of face masks in the aftermath of the outbreak of the coronavirus outbreak, experts are divided over whether they can prevent transmission and infection. There is some evidence to suggest that masks can help prevent hand-to-mouth transmissions, given the large number of times people touch their faces. The consensus appears to be that wearing a mask can limit – but not eliminate – the risks, provided they are used correctly.
The company has said it is providing free meals to hospital workers treating people affected by coronavirus.
A slew of multinational firms have already predicted a financial hit, while many have introduced emergency measures to ban staff from travelling to China and to quarantine those who have already done so.
Apple said it had now factored disruption into its financial forecasts, given that it has multiple factories in China, which is also the world’s largest smartphone market.
The coffee chain Starbucks said it had been forced to close about half of its 4,100 shops in the country, signalling a significant hit to revenues.
Facebook has suspended non-essential travel to mainland China and told employees in China to work from home. HSBC, which is Europe’s largest bank and has strong ties to China, has done the same.
Standard Chartered and Goldman Sachs are among banks that have taken similar steps, while the South Korean electronics firm Samsung has told staff in Hubei to stay at home for seven days.
Airlines around the world have also cancelled flights to China, including British Airways, the US carrier United and Air Asia. Germany’s Lufthansa said on Wednesday that its flagship carrier, as well as Swiss and Austrian Airlines, would fly to China “one last time” before suspending operations until 9 February.
Global stock markets have been hit by concerns about the impact of the virus, as reports of cases in other countries stoked fears that the outbreak could spread internationally.
Stocks tumbled across Hong Kong’s Hang Seng index overnight. It fell 807 points, or 2.9%, at 27,141 – wiping out all the gains posted since mid-December. European stock markets have also suffered amid anxiety about coronavirus.
A Chinese government economist warned that the Wuhan coronavirus may cause more economic damage than the Sars epidemic, predicting the country’s annual growth could drop below 5% in January-March quarter.
