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McDonald's Restaurants In Kazakhstan Temporarily Close As Supplies Halted Amid Russia Sanctions.

McDonald's started its operations in Kazakhstan in February 2016.

McDonald's started its operations in Kazakhstan in February 2016.

ASTANA -- The licensee of McDonald's in Kazakhstan has been forced to temporarily suspend operations because of supply chain issues sparked by Russia's war against Ukraine and not, government officials said, because of the arrest of a relative of former President Nursultan Nazarbaev who controls the company that operates the restaurants in the Central Asian nation.

Kazakh Deputy Prime Minister Serik Zhumangharin said on November 29 that McDonald's had suspended their operations earlier this month to help restructure operations after imports of many items needed to run the franchises were halted.

"A large chunk of needed items, about 1,000 used by McDonald's in Kazakhstan, used to be imported. The process of restructuring is under way. I have asked the Committee of Technical Regulation to provide assistance [to McDonald's franchises] with certification," Zhumangharin said when asked by reporters about the situation surrounding the closure of the restaurants.

He added that the arrest in March of Qairat Boranbaev, the owner of Food Solutions, the company that operates the franchises in Kazakhstan, "had not significantly affected" the situation.

Boranbaev is the former father-in-law of the late Aisultan Nazarbaev, a grandson of Nazarbaev.

Zhumangharin did not give any additional details.

The company uses many supplies imported from foreign countries, mainly from Russia, which was hit with Western sanctions over its invasion of Ukraine. McDonald's subsequently exited the Russian market in May, selling all its restaurants to a local licensee, leaving Kazakh restaurants scrambling for new suppliers.

Joe LaPaille, a spokesperson for McDonald's Corporation in the United States, told Reuters on November 29 that the "McDonald's licensee in Kazakhstan has temporarily closed all of its restaurants due to local supply issues. We are working together to resume operations as quickly as possible."

Since McDonald's started its operations in Kazakhstan in February 2016, it has become extremely popular across the country, with 24 outlets operating in Astana, Almaty, Atyrau, Aqtobe, Qaraghandy, and Qostanai. McDonald's has a staff of about 2,000 people in Kazakhstan.

A source close to Food Solutions told Reuters that the company started looking for new suppliers after it started running out of packaging materials imported from Russia. Both sources spoke on condition of anonymity as they were not authorized to talk publicly about the situation.

With reporting by Tengrinews and Reuters

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