Malaysia's Pro-Palestine Boycott Sparks Economic Concerns

After Israel's assault on the Gaza Strip, a wave of boycotts and protests emerged in the Muslim world to express solidarity with Palestine.

As one of Palestine's allies, Malaysia became a key player in this wave of boycotts, resulting in a severe impact on the performance of our country's businesses, such as McDonald's and Nestle.

Photo taken from MyCare

While boycott activities can highlight a sense of unity, this wave of boycotts has gradually become more irrational and uncontrollable. We need to reflect on whether the entities suffering are the distant foreign headquarters of these companies or the grassroots-level employees in our country.

In history, there have indeed been many successful boycott cases, achieving their goals through methods such as raising awareness and applying financial and economic pressure.

Boycott against South Africa; Photo taken from Bloomberg

Examples include International Buy Nothing Day, the Delano Grape Strike, and the international boycott against South Africa in the 1980s and 1990s. Reviewing these historical instances, we understand that these renowned boycott activities directly struck at the top of the pyramid – the beneficiaries of interests. However, can the impact and purpose of Malaysia's domestic boycott activities be compared to these internationally renowned boycotts?

This is not the first time Malaysia has experienced boycott activities. Boycotting products and services related to Israel and its allies has been in place for decades, but it failed to gain traction due to insufficient participation. Recently, with the shift in social media and international sentiments, coupled with renewed conflicts between Israel and Palestine, the boycott movement has resurfaced.

McDonald's Malaysia promotion after boycotting by the citizen; Photo capture from McDonald's Malaysia.

Muslim compatriots have actively promoted the boycott of certain products through social media, with McDonald's being the primary target, mainly due to Israeli McDonald's providing food to the Israeli Defense Forces. Other boycotted products include Starbucks and Nestle's products.

While I can understand that the actions of Israeli McDonald's indeed touched a nerve in the Muslim world, is boycotting Malaysia's McDonald's going to cause significant damage to Israeli McDonald's or even McDonald's in the United States?

Most participants in this boycott seem to fall into the trap of venting emotions, creating a binary opposition of good and evil, and identifying an enemy to fuel emotional attacks. To strongly express dissatisfaction with the perceived "unjust," most boycotts do not require rationality but rather adherence to political correctness.

Those following recent news are aware that McDonald's has shortened its operating hours, reduced food prices three times, and employees are starting to worry about their income. However, has McDonald's US headquarters expressed concerns about declining performance, or has Israeli McDonald's apologized to the Muslim world?

The answer is no. Instead, McDonald's in Malaysia has announced donations to Gaza.

Nestle Products. Photo taken from Kosmo Digital

After the conflict erupted in early October, Nestle announced that it suffered a loss of MYR 1.477 billion in market value in November due to the boycott uproar and performance pressure.

Dr. Azmi Hassan, a senior fellow at Nusantara Academy for Strategic Research, points out that many of the boycotted chain brands produce products that are not manufactured in Israel. The current boycott actions may impact chain brands or large companies planning to invest in Malaysia.

"In the future, the boycott may also impact franchises or big companies that want to invest in Malaysia. We need to rethink the boycott," Dr. Azmi told New Straits Times.

He further emphasizes that the government should implement a comprehensive boycott of products originating from Israel, or it may send negative signals to foreign companies planning to invest in Malaysia.

In addition, Dr. Ei Sun Oh, the Principal Adviser of the Pacific Research Center of Malaysia and a senior fellow at the Singapore Institute of International Affairs, also told the New Straits Times that the impact of Western countries view boycott activities as anti-Semitism.

"A pull-out of Western investments is likely, as these boycotts are considered by them to be anti-Semitic. What described above is likely to materialise, as our competitiveness versus up-and-coming countries such as Vietnam is slipping anyway.

"So this is going to buttress Western investors' willingness to move to Vietnam instead." Dr. Ei Sun Oh said.

Examining the plight of these companies and the words of experts, we can understand that this boycott activity has only affected Malaysians, while foreign headquarters and subsidiaries have not been substantially impacted.

Singapore's Minister for Foreign Affairs, Dr. Vivian Balakrishnan; Photo taken from Berita Mediacorp.

In terms of international attitudes, although Malaysia's stance may seem less significant among over two hundred countries, it is hoped that politicians consider the perspective of Singapore's Minister for Foreign Affairs, Dr. Vivian Balakrishnan.

“This is not our quarrel, this is a quarrel amongst our friends, and our job is to be sympathetic, to be compassionate, to speak truth to them, to be helpful but not to pour oil on fire.”

“Understand that strong emotions are engaged, but we must not fall prey to what we see in other countries, where strong emotions have led to violent clashes, to hate speech and to exclusion, and as many of you have illustrated, often fuelled by disinformation. Our religious and racial harmony is very precious. We must not allow anything to break this or split our society.” Dr. Vivian Balakrishnan said.