McDonald’s Corp, the world’s largest restaurant chain, increased prices for its burgers, drinks and snacks in China yesterday to offset costs after the country’s inflation surged to a two-year high.
Product prices were raised between 0.5 yuan and 1 yuan (US$0.08 and US$0.15) because of higher raw material costs, Sophia Luan (欒江紅), China spokeswoman for the Oak Brook, Illinois-based company, said in a telephone interview. She declined to provide an average percentage increase.
China has the world’s cheapest Big Macs partly because of a weak yuan, according to The Economist Big Mac Index as of Oct. 14. The sandwiches cost US$2.18 each on average in Beijing and Shenzhen, compared with US$3.71 in the US.
Photo: Reuters
Big Macs are most expensive in Switzerland at US$6.78, according to the magazine’s index, which uses the concept of purchasing power parity that states the dollar should buy the same amount in all countries.
Meanwhile, China’s Cabinet is drafting measures to counter excessive price increases, Chinese Premier Wen Jiabao (溫家寶) told state television on Tuesday. In comments posted late Tuesday on the government’s Web site, Wen said: “Great attention should be paid to market supply and demand and prices because they are related to the public’s basic interests.”
“The State Council is formulating measures to curb the overly fast rises of prices,” he said, giving no details.
Wen made the comments during a visit to a supermarket last Thursday in Guangzhou.
He spoke after data last week showed the nation’s consumer price index rose 4.4 percent year-on-year last month, much higher than the government’s full-year target of 3 percent. It was the fastest since September 2008, after which the global financial crisis slowed down price rises.
A Chinese consumer confidence index fell in the three months ended September, the first decline in six quarters, on expectations the costs of goods and services will keep rising.
A total of 76 percent of consumers expect prices will increase further over the next year, up from 70 percent the previous quarter, according to a statement from Nielsen Co and the Chinese statistics bureau’s Economic Monitoring and Analysis Center yesterday. Concerns about inflation are strongest among rural and first-tier city consumers, the survey said.
“If consumers see justifications for price increases, such as value and product safety, they will be willing to pay for it,” Vinay Dixit, senior director of Asia consumer centers at McKinsey & Co, said in an interview in Shanghai.
China may impose price limits on food and toughen punishment of those found speculating on agriculture futures including corn and cotton, the China Securities Journal reported, citing an unidentified person.
The Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, dropped 55.68, or 1.9 percent, to 2,838.86 at the 3pm close, the lowest level in a month. The gauge has lost 10 percent since reaching an almost seven-month high on Nov. 8 as investors speculated the government will raise rates for the second time in a month and institute price controls to combat the fastest inflation in two years. The CSI 300 Index retreated 2.1 percent to 3,103.91 yesterday.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Standard Chartered Taiwan on March 26 announced that it has partnered with international fintech firm FinIQ to build an “Automated Structured Products Pricing Platform.” The bank is also introducing products from global issuers including Goldman Sachs Group Inc, Barclays PLC and BNP Paribas SA. The new platform enables an end-to-end process whereby it finds the most competitive pricing across multiple issuers in a matter of minutes, followed by automated documentation and transaction execution, which significantly shortens time-to-market and delivers a superior wealth management experience. Standard Chartered Bank Taiwan CEO Anthony Yu (游天立) said: “Standard Chartered is increasingly leveraging its wealth management
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