China's Dining Dilemma: A Wave of Restaurant Closures

Nearly 3 million food service establishments in China shuttered last year, largely due to bankruptcies. From fine dining to fast food, the industry's contraction reflects wider economic challenges as rising rents and raw material costs hit hard.

A staggering 3 million restaurants, cafes, and other food service venues across China have closed in the past year, Radio Free Asia (RFA) reports. The wave of closures, marked by bankruptcies, has even seen popular chains drastically reduce their branches to manage financial strain.

In a December announcement that went viral on social media platform Weibo, Taiwanese chicken chain Zhenghao Da Da declared plans to shut all its Chinese outlets, kicking off with Shanghai's iconic New World City Plaza, according to RFA. Headlining articles have called 'contraction' and 'stores closing' the new industry buzzwords for 2024, painting a chilling picture for the future.

This downturn affects all industry segments—from upscale dining to casual cafes and snack outlets. Even elite Western dining venues are not spared, with Beijing's Michelin-starred Opera BOMBANA closing its doors in April 2024, amid unpaid wages and outstanding debts. The luxury dining sector has seen significant casualties like Shanghai's L'Atelier 18 and Roodoodoo, barely lasting beyond a few months.

The financial squeeze is equally felt in fast food and beverage sectors; milk tea brand Taigai and coffee chain Jixu Fresh Fruit Coffee are among those reducing presence. Online commentator Lao Zhou notes that increased rents and raw material prices are pivotal, emphasizing, "If people can't afford to dine out, restaurants inevitably pay the price." (ANI)

(With inputs from agencies.)