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Putin’s Mac Attack Would Take Bite Out of McDonald’s

Fiscal Times logo Fiscal Times 4/10/2015 Rob Garver
Russian President Vladimir Putin addresses during a joint news conference with Hungarian Prime Minister Viktor Orban in Budapest February 17, 2015. REUTERS/Laszlo Balogh© LASZLO BALOGH Russian President Vladimir Putin addresses during a joint news conference with Hungarian Prime Minister Viktor Orban in Budapest February 17, 2015. REUTERS/Laszlo Balogh

Russian President Vladimir Putin reportedly directed a top deputy to look into the feasibility of a plan – concocted by two Russian filmmakers – to create a Russian fast-food chain meant to compete directly with U.S.-based McDonalds, which has some 400 outlets in the country.

Nikita Mikhalkov and his brother Andrey Konchalovsky, both successful film directors (Mikhalov’s Burnt by the Sun won the Oscar for best foreign film in 1994), applied to the Russian government for financial assistance in launching the business. It would be called “Let’s Eat at Home” and would serve prepared food made from locally-sourced ingredients. 

The restaurants were proposed to give Russians a patriotic reason to take their business away from Western-owned chains. 

“The purpose of this project is to promote import substitution and an alternative to Western fast food chains,” the brothers wrote to Putin in a letter obtained by the newspaper Kommersant. They requested nearly one billion rubles, or about $18.7 million, to get the project off the ground. 

According to the Kommersant report, Putin met with Mikhalov last month, and assigned Deputy Prime Minister Arkady Dvorkovich to examine the proposal. The brothers hope to launch 41 cafes and an additional 91 food stands selling pre-made meals. 

However, it remains unclear just how much support the brothers can expect from the Kremlin. On Thursday, Anatoly Kutsenko, a top official with the Russian Ministry of Agriculture, said that a request for funding made to his department appeared to be misdirected.

“The task of the Agriculture Ministry is to prepare products for consumption but the question is in the format ... This is related to catering business and is not a question to us directly,” Kutsenko told the state-run news agency TASS. “Of course we do not object but it does not meet our aid format, after all it’s a question to the Industry and Trade Ministry.”

The fact that Putin has taken a personal interest in the project suggests an initial rebuff from the Agriculture Ministry might not spell the end of the project. 

McDonalds has long been used as a political football since its first store opened in Russia in 1990. As recently as last year, a number of franchises, including the chain’s marquee location in Moscow’s Pushkin Square, were shut down by the Russian government over questions about public health.

The move came as the U.S. and its allies were marshaling sanctions against top Russian officials over the invasion of Ukraine’s Crimean peninsula last year. It was widely viewed as a political message rather than a legitimate public health concern. The restaurants were all later reopened. 

The “Let’s Eat at Home!” brand would also not be the first attempt to unseat McDonalds with a homegrown burger chain. The RusBurger corporation, founded in 2009, markets itself as a Russian alternative to McDonalds and currently operates stores in 25 cities across the country. 

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