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Is McDonald's Exporting Obesity?


Overseas sales are growing, and so are foreigners' waistlines.

The weak dollar appears to have goosed October sales overseas, including a 6.4% increase in Europe and a 4.7% increase in Asia/Pacific, Middle East, and Africa.

In the third quarter of 2009, comparable sales at McDonald's increased 2.5% in the US, 5.8% in Europe, and 2.2% in Asia/Pacific, Middle East, and Africa from the same period a year ago.

The US fast-food market is mature and filled with robust competitors, including Burger King (BK), Wendy's/Arby's Group (WEN), and Yum Brands (YUM), the largest fast-food operator in terms of locations and selling under the KFC, Pizza Hut, Taco Bell, and Long John Silver's brands. So, it's no mystery why McDonald's looks overseas for growth.

In 1989, McDonald's opened its first store in Moscow following a decade of aggressive expansion in Europe. Despite farmer John Bove's 1999 decision to use his tractor to vandalize a McDonald's restaurant in the region of France known for Roquefort cheese, the chain recently announced plans to open shop in the Louvre.

In 2007, McDonald's opened its first drive-thru restaurant in China. McDonald's cut a deal with China Petroleum & Chemical (SNP) to combine fast-food outlets with gas stations.

Last August, The Independent proclaimed: "Uganda Talks Exclusive: McDonald's to open in Uganda."

There are many factors in obesity other than consuming fast food, including exercise and an individual's genetic makeup. But it's hard to see how fast food, typically high in fat and sugar, helps.

The famous tagline for a Wendy's TV commercial in 1984 asked, "Where's the beef?" For McDonald's the answer is increasingly strong overseas sales. A growing number of customers worldwide may discover that the result of increased fast-food consumption is hanging over their belt.

Eric Schlosser, author of Fast Food Nation, argues: "Between 1984 and 1993, the number of fast-food restaurants in Great Britain roughly doubled -- and so did obesity rates among adults…The profits of the fast-food chains have been made possible by the losses imposed on the rest of society."

Maybe. But before we decide that hamburgers are a worldwide plague, let's remember that while eating broiled cow in great quantity may be unwise, two all-beef patties, special sauce, lettuce, cheese, pickles, and onions on a sesame seed bun is a legal product.

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