Pros and Cons of Transnational Corporations
Explain the pros and cons of TNCs on the developing world.
TNCs, transnational corporations are large companies that have operations in more then one country. An example of a TNC is Coca Cola. There are many pros to TNCs such as they build infrastructure, bring new technology to the country and provide jobs for local people. But there are also many cons like land degrading, they exploit workers, and they avoid taxes.
TNCs invest in poor countries, they build new infrastructure. TNCs commonly build new factories in LDCs, they also build or repair roads in the area so it is easier to transport goods, this brings wealth to the local area and benefits local people. However TNCs can often cause major environmental degradation which mainly impacts the poorest people like for example the Ogoni people of the Niger delta have received no benefits from oil being extracted from their lands, while suffering considerable environment damage. TNCs provide jobs for people in LDCs, workers are usually paid up to 100% more than the local rates. This reduces unemployment in the area and slightly increases wealth however workers are often exploited, by having to work long hours, getting low wages and work in poor conditions which are often unsafe. For example the Primark factory that collapsed in Bangladesh killing over 1100 people in 2013.
TNCs bring new technology from MDCs into LDCs this helps people there develop new skills which they can then go on to use in different jobs. This also helps countries become more globalised. For example the transfer on technology helped firms in South Korea such as Samsung to learn to design, make and sell their own products to foreign markets.
Many TNCs avoid paying taxes in countries they operate in by transferring pricing and tax concessions. This makes it difficult for governments to raise revenues to provide services for local people.
In conclusion TNCs help countries develop by investing in their economies like for example china
TNCs, transnational corporations are large companies that have operations in more then one country. An example of a TNC is Coca Cola. There are many pros to TNCs such as they build infrastructure, bring new technology to the country and provide jobs for local people. But there are also many cons like land degrading, they exploit workers, and they avoid taxes.
TNCs invest in poor countries, they build new infrastructure. TNCs commonly build new factories in LDCs, they also build or repair roads in the area so it is easier to transport goods, this brings wealth to the local area and benefits local people. However TNCs can often cause major environmental degradation which mainly impacts the poorest people like for example the Ogoni people of the Niger delta have received no benefits from oil being extracted from their lands, while suffering considerable environment damage. TNCs provide jobs for people in LDCs, workers are usually paid up to 100% more than the local rates. This reduces unemployment in the area and slightly increases wealth however workers are often exploited, by having to work long hours, getting low wages and work in poor conditions which are often unsafe. For example the Primark factory that collapsed in Bangladesh killing over 1100 people in 2013.
TNCs bring new technology from MDCs into LDCs this helps people there develop new skills which they can then go on to use in different jobs. This also helps countries become more globalised. For example the transfer on technology helped firms in South Korea such as Samsung to learn to design, make and sell their own products to foreign markets.
Many TNCs avoid paying taxes in countries they operate in by transferring pricing and tax concessions. This makes it difficult for governments to raise revenues to provide services for local people.
In conclusion TNCs help countries develop by investing in their economies like for example china