Does Mncs Doing Good to Our Country
Multinational corporations are large companies which operate in more than one country. Developing countries are the host countries and have become the object of study as there are many questions regarding the benefits of hosting a MNC. Are MNCs contributing to the sustainable development of a developing country? Or, do they simply exploit developing countries creating a country dependent on that MNC for their own economic, social and ecological growth? Apparently they are transferring new technologies to a developing country, the introduction of sophisticated managing techniques, and foreign direct investments. Depending on this point of view, either the MNC brings valuable tools to a developing country which in turn infuses their economy with new jobs and raises the skills of the workers or the MNC fully exploits the developing country exporting the technology, capital and resources back to the parent country or other developed countries for profit.
Present a set of logic in favor of the existence of MNCs in developing country
DIRECT FOREIGN INVESTMENT (DFI):
MNCs help increase the investment level and thereby the income and employment in the host country. MNCs build up factories, office buildings, warehouses, etc. in the developing countries as a form of subsidiary investment. This results in a large scale flow of funds into the developing country, which is good for the developing nation as it is bringing in a gross amount of foreign currency into the country.
We know that DFI is a component of Capital Account. At macroeconomic level, FDI may significantly contribute to finance current account deficits in the balance of payments of host countries. Though the improvement of balance of trade is an argued topic but apparently it is good for the economic growth of a country.
Create Employment:
From the perspective of a developing country, establishing a MNC is beneficial in the sense that it creates a huge chance of employment for
Present a set of logic in favor of the existence of MNCs in developing country
DIRECT FOREIGN INVESTMENT (DFI):
MNCs help increase the investment level and thereby the income and employment in the host country. MNCs build up factories, office buildings, warehouses, etc. in the developing countries as a form of subsidiary investment. This results in a large scale flow of funds into the developing country, which is good for the developing nation as it is bringing in a gross amount of foreign currency into the country.
We know that DFI is a component of Capital Account. At macroeconomic level, FDI may significantly contribute to finance current account deficits in the balance of payments of host countries. Though the improvement of balance of trade is an argued topic but apparently it is good for the economic growth of a country.
Create Employment:
From the perspective of a developing country, establishing a MNC is beneficial in the sense that it creates a huge chance of employment for