Fast Food Franchises–Devil’s Work Or Angel Food?

Front street, Hamilton, Bermuda. Bermuda banned fast food franchises in 1977, partly to maintain an old world atmosphere, and partly to protect local restaurants from competition, and possibly also to preserve foreign exchange reserves.
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Trinidad and Tobago’s Health Minister Terrence Deyalsingh’s recent naming and shaming of fast-food restaurants that feed addiction to fat and sugar calls for closer examination as to the costs and benefits of fast food franchises in island states.

“I know I’m going to get licks for this in the paper,” the Minister of Health said on Monday at a “health and wellness” event held at the plush Hyatt Regency in Port of Spain. “But we need to face the truth. All these things are addictive. It is no different from the cigarette industry.”

He pointed fingers at brands like Coca-Cola, KFC, Domino’s, McDonald’s and Wendy’s.

But the picture is more complicated than Mr Deyalsingh suggests.

As recently as a few years ago, about seven per cent of the country was undernourished, according to the UN’s Food and Agriculture Organization. This went down from just over 11 per cent in 2014.

That was undoubtedly due to the increasing availability of cheap food, which is primarily what fast-food outlets supply.

While the minister cited the billions spent yearly on marketing by companies such as Coca-Cola ($27 billion) and compared this with the total annual spending of his ministry ($7 billion), the comparison is not accurate. These entities are franchises with local operators, not giant multinationals.

Furthermore, such franchises employ hundreds, if not thousands, of local people, particularly people who would otherwise have difficulty finding a job because they do not have tertiary qualifications.

The recent report that Prestige Holdings Ltd – which runs KFC, Pizza Hut, Subway, Starbucks and TGI Fridays – recorded a profit before tax of $84 million for 2023, compared to $54 million in 2022, also points to another issue.

Fast-food operators generate a steady stream of tax income for the treasury, as well as sending a steady stream of profits to overseas shareholders, thus having some effect on the balance of payments.

If the State’s spending on combating lifestyle diseases is considered significant, we need to add to the equation the economic stimulus provided by fast-food businesses in local communities.

These companies don’t force people to eat their food. They provide a valuable service for many, of all creeds and income brackets.

Which is not to disagree with Mr Deyalsingh or to justify the alleged exploitation of bad habits. But fast-food restaurants also supply healthy options for those who want them.

For example, Subway, whose products are consumed by about 68 per cent of the young population according to a recent survey by the Diabetes Association (DATT), is known for promoting weight loss.

In some cases, eating fast food may be healthier than skipping a meal. It can help people manage their schedules more effectively and help communities address hunger.

Still, we are under no illusions. Too much fast food can be a bad thing. DATT has called for taxes to combat over-consumption.

However, we wonder whether Mr Deyalsingh, who sits in the Cabinet, should not be pushing for giving people cheaper options when it comes to eating healthily.

Encouraging agricultural business more aggressively, perhaps as part of a public health emergency strategy, might be a better approach than simply mouthing off on companies and judging people and businesses simplistically on the strength of untested assumptions about both.

Although most destinations in the Caribbean have American fast food franchises, one exception, albeit in the Atlantic, not the Caribbean is Bermuda where fast food franchises have been banned since 1977.

Today, only a single fast-food restaurant exists in Bermuda. A Kentucky Fried Chicken restaurant that opened in the 1970s was grandfathered in and permitted to remain open after the harsher legislation on foreign franchises was passed.

Otherwise, the Bermuda government considers prohibited establishments as any “restaurant which is operated in any matter, whether through distinctive name, design, uniforms, packaging, decoration, or otherwise, which reasonably suggests a relationship with any restaurant or group of restaurants operating outside Bermuda.”

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