All McDonald’s in Iceland to be shuttered; Does this mean war?

You know what McDonald's closing in Iceland means for you little guy, don't you?

It looks like you won’t be able to get yourself a Filet o’Fish or a quarter-pounder with cheese in Iceland anymore – all three of the country’s McDonald’s franchises will close at the end of the year:

Iceland’s McDonald’s Corp. restaurants will be closed at the end of the month after the collapse of the krona eroded profits at the fast-food chain, McDonald’s franchise holder Lyst ehf said.

McDonald’s in Iceland, which imports most of the ingredients it uses in its meals, will shut after costs doubled over the past year, Lyst said in an e-mailed statement today. The franchise holder said it doesn’t expect the situation to change in the short term.

“We would have to raise our prices by 20 percent to get the margin needed on our products,” Magnus Ogmundsson, Lyst chief executive officer, said in a phone interview. “That would have sent a Big Mac to 780 kronur” ($6.36), compared with the 650 kronur it costs today, he said.

via McDonald’s Closes in Iceland After Krona Collapse (Update1) – Bloomberg.com.

I guess the alternative to serving flown-in, flash-frozen beef patties, the McPuffin with cheese, did not go over well when proposed locally.

While this news marks a sad moment for the Icelandic economy, I think the international relations dimension of this story is being neglected. We will at last have another opportunity to test Thomas Friedman’s ‘Golden Arches Theory of Conflict Resolution.’

You know the one – it states that no two countries with McDonald’s will go to war with one another. Of course, Georgia and Russia have fought a war, which proves that two countries went to war with one another after McDonald’s were opened. And then there are India and Pakistan, which both have McDonald’s, and both continue to shoot at one another over Kashmir periodically in spite of McDonald’s being opened while they continued to be in a state of conflict.

But now we have an exciting opportunity to test whether or not losing your McDonald’s caused recidivism in a nation’s aggression toward their ‘neighbors,’ a term we must use loosely in Iceland’s case.

Consider: Iceland has fought three ‘Cod Wars,’ mostly with the United Kingdom, over fisheries it claimed to control. The last ‘Cod War’ ended in the 1970s.

The first McDonald’s was opened in Iceland in 1993. Now they are no more? Will the Icelandic Coast Guard immediately head out in the next six months and ram a Royal Navy battleship?

They may just prove that Friedman is right about something for a change…