KFC Malaysia temporarily shutters outlets citing challenging economy

KUALA LUMPUR (Reuters) - KFC Malaysia has temporarily closed outlets in the country, citing challenging economic conditions, after local media reported that the closings were because of boycotts over the fast food chain's perceived links to Israel.

Malaysia, a majority-Muslim country, is a staunch supporter of the Palestinians, and some Western fast-food brands in the country, as in some other Muslim nations, have been targeted by boycott campaigns over Israel's military offensive in Gaza.

QSR Brands (M) Holdings Bhd, which operates KFC and Pizza Hut franchises in Malaysia, said it temporarily closed KFC outlets "in response to challenging economic conditions".

"QSR Brands and KFC Malaysia has taken proactive measures to temporarily close outlets as means to manage increasing business costs and focus on high engagement trade zones," it said in a statement late on Monday. The statement did not address the media reports.

It did not specify how many stores were affected, but local media reported over 100 outlets were temporarily closed.

Employees from the affected stores were offered the opportunity to relocate to outlets in areas with higher customer engagement, QSR Brands said.

(Reporting by Danial Azhar. Editing by Gerry Doyle)