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

More and more transnational corporations are setting up branches and factories in less developed nations. Some believe that
such
companies bring positive development in the
host
country
’s growth,
however
, in the opinions of others, these are a threat to the nation.
This
essay will discuss the benefits and
also
the drawbacks of
this
trend. There are numerous advantages of
such
global movements of multinational companies. They increase job opportunities in poor countries which automatically decrease poverty rate. Big organizations like Apple, Microsoft, and Amazon prefer to recruit local employees because of their knowledge about the domestic market, culture, and preference of citizens.
In addition
, underdeveloped nation gets new technology. Multinationals bring with them technology and production methods that are probably new to the
host
country
and a lot can
therefore
be learnt from these techniques.
As a result
, not only production quality, but
also
economy grows significantly. Despite the benefits, there are some drawbacks associated with
this
trend. The main issue is that domestic business faces a lot of competition in the local market. In other word, the multinationals, establishes their monopoly in the market where they operate,
thus
killing the local businesses. In India,
for example
, many domestic food products shut down because of foreign outlets like McDonalds and Burger King.
Also
, the
host
country
has to face problems related to the environment. Many foreign industries use the natural resources of the home
country
in order to make huge profit which results in the depletion of the resources
thus
causing a loss of natural resources for the economy. In conclusion, transnational corporations are both boon and bane at the same time. Because of them
host
country
can tackle with problems like unemployment burden, standard of living, and technological improvement, but it
also
has to face issues like business competition for domestic companies, and environmental loss.
Submitted by chavanpranay1994 on

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