Photo: Nacho Doce / Reuters
The world’s largest franchise operator of McDonald’s — Arcos Dorados — concerned about the threat to the growth of consumption in Brazil. About it writes Bloomberg.
“Brazil is our main concern and we are closely monitoring the evolution of the macro-environment because it is our main driving force,” said CEO Sergio Alonso.
According to him, the problem arises when expectations, stimulating consumption, not accompanied by economic policy. Alonso said that now all attention is focused on pension reform in Brazil. If it will not be approved until August, this will kill emerging consumption growth in the country, he said.
Reforming the Brazilian pension system aimed at saving more than one trillion reais ($256 billion) over the next ten years. According to Alonso, now consumption is growing based on expectations that the economy will get foreign investment as soon as Congress will hold a pension reform.
According to the Instituto Brasil Foodservice, consumer spending in the fourth quarter on catering services increased by 3.3 percent compared to the previous quarter and 2.6 percent year on year.
Arcos Dorados plans to invest in Latin America until the end of 2019 of about $ 300 million, with approximately two-thirds of the funds will be spent in Brazil. According to the CEO of the company, the lack of reforms could spoil his plan to spend the money to build the McDonald’s franchise at the biggest market of 20 countries.
In accordance with the reform, in particular, it is proposed to establish a minimum age for retirement at 65 years for men and 62 for women. Now the pension in full amount is charged to Brazilians by the formula 85/95: for men it is necessary that the sum of age and working experience, during which he made contributions to the pension Fund, was at least 95 years for women, this amount should be 85.
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