By Teo Cheng Wee
Foreign Correspondent
chengwee@sph.com.sg

 

In Kuala Lumpur

IN MALAYSIA, it's not just the government that launches stimulus packages. Come Thursday, fast food chain McDonald's is launching what it calls "lunch stimulus packages".

It splashed a slew of ads in local papers today, advertising weekday lunch deals for RM5.95. That is some 30 to 40 per cent cheaper than its usual Double Cheeseburger or McChicken meals.

"With McDonald's McValue Lunch," the tagline goes, "you can enjoy stimulating meals that make perfect economic sense."

Without taking away anything from the Malaysian government, McDonald's stimulus package is a great economic indicator in its own right.

The popular food chain here typically does not need to slash prices to get customers. It usually only offers lunch deals this cheap during the fasting month, to try and attract non-Muslim customers to fill its empty seats.

A case in point: Last December, anti-Israel protesters here had urged Malaysians to boycott McDonald's, as well as other American brands, during Israel's siege on Gaza. But it had minimal effect in KL's city centre, with the KLCC branch still often packed to the rafters.

But at a time when most news is bad news, belt-tightening is the order of the day. And by slashing prices from RM9 to RM5.95 for their meals, McDonald's is lowering the cost of lunch at their restaurants on par with that of food courts.

It won't be the only one pulling out the stops to boost sales this year. Indeed, 2009 is proving to be a sharp turning point, at least to the retailers I spoke to casually in KL's malls. Many mentioned that business took a dip after the New Year.

"During December and the Christmas period, business was still good, so we didn't really see 'recession'. But then 2009 came, and it got real quiet," said one pastry shop owner at Pavilion, the latest mega mall in the capital. He has been giving away free pastries with purchases during Chinese New Year, to attract customers.

More job losses are also being reported in the new year, but the government is maintaining a brave front. 

It is sticking to its 3 per cent growth forecast for this year, even as other economists slash their estimates. The more optimistic private analysts are predicting 1 per cent growth, while the pessimistic ones expect the economy to shrink and possibly go into recession.

If that happens, you can be sure that McDonald's won't be the last company to come up with their own stimulus package.