Multinational companies are becoming increasingly common in developing countries. What are the advantage and disadvantages of this?

It is true that many global companies are setting up their offices and factories in

under developed

relating to societies in which capital needed to industrialize is in short supply

underdeveloped

nations.

This

essay will suggest that increased employment opportunities

is

Suggestion

are

the primary benefit

for

Suggestion

of

the local population, while disruption in the local

market

is the main drawback. The main advantage of the rise in multinational companies is that it increases the availability of jobs in the

market

. Major corporations have set up big offices and factories in emerging markets for their products and services, due to which they require a large number of staff for various jobs.

For example

, Apple recently opened a new factory in the small town of Bihar, where the employment level is very low, and they have provided jobs to 2000 people in that area. Despite

this

economic benefit, multinationals are not quite welcomed in the local

market

, because they cause

market

disruptions. With high manpower and logistical resources, multinationals can make a variety of products quickly, and local vendors cannot compete with the price, quantity and quality of their products.

For instance

, when Ikea launched its

first

store in Hyderabad

this

year, a lot of furniture stores in the city had to close down because buyers preferred to

do

engage in

make

all their purchases under one roof

instead

of visiting different local sellers.

Thus

, local shops are losing out on business, and eventually closing down. In conclusion, multinationals provide increased employment opportunities to people, but at the same time affect local vendors by forcing them out of business with their high production output and low price margins. It is recommended that the government passes laws and legislations to make sure that local businesses can survive and thrive in

this

competing

market

as well.