BUDAPEST, Hungary -- McDonalds will open five fast-food restaurants in Budapest and plans to expand throughout the country and other Eastern European nations where the proper ingedients can be found, it was announced Tuesday.
McDonalds Vice President Steven Barnes and Robert Burgert, general director of the Hungary's Babolna Agricultural Combine, signed an agreement Monday to open the five restaurants in Budapest, with the first to open next year.
The Budapest restaurants would be the first stage of a joint venture that is expected to expand elsewhere in Hungary, the men said.
As in other McDonalds restaurants, basic materials will be supplied locally. Quality requirements of the chain will be observed in meat and milk, according to a dispatch Tuesday by the official Hungarian news agency MTI.
Both sides have allocated $1.25 million for the joint venture.
McDonalds has signed a similar agreement in Yugoslavia and had been negotiating to set up franchises in Poland. But it ran into trouble when the Poles could not supply the type of potatoes needed for its french fries.
'The Poles are refusing to accept our system,' one McDonalds executive said at the time.
Hungary already has its own fast-food in the country for some time. A chain of state-owned shops called City Grill serving hamburgers and milkshakes, along with traditional Hungarian cakes such as strudel.
Hungarians' appetite for fast food is such that the American chain Burger King, with no franchise in Hungary, has bought advertising nevertheless because so many Hungarians travel to Austria where it does have restaurants.