Gulf retail giant AlShaya Group, which owns the rights to operate Starbucks in the Middle East, plans to lay off over 2,000 people as the business takes a hit from consumer boycotts linked to the Gaza war, according to people familiar with the matter, Reuters reports.

The cuts, which began on Sunday, amount to about 4 per cent of AlShaya’s total workforce of almost 50,000 people and are mostly concentrated in its Starbucks franchise in the Middle East and North Africa, said the people, who declined to be named as the matter is not public.

The boycotts have led to tough trading conditions for the company, one of the people said.

Starbucks said in January that the Israel-Hamas conflict has hurt its business in the region as it missed market expectations for first-quarter results.