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

Multinational corporations are capturing markets in developing countries.

This

development can lead to positive repercussions,

such

as higher employment levels and economic growth

,

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while

taking down small local businesses and market dominance would be a big disadvantage.

To begin

with, when a global company arrives in a new country, it has to employ workers for manufacturing.

For

this

reason, big firms search for a huge number of employees and provide job opportunities with a good level of income for citizens.

Moreover

, the higher employment and salary rates accelerate the economic growth in those areas.

For instance

, the arrival of big textile companies

such

as Nike and Adidas in Vietnam has provided job vacancies for thousands of people;

as a result

,

this

increased the GDP level by 15%.

On the other hand

, the appearance of multinational corporations leads to serious issues with local businesses and products. Because of the high reputations and qualitative goods from international organizations, communities will give their preferences to them rather than buying something from small firms. Worldwide companies will start dominating the market;

further

, all of the items created by indigenous people will disappear from the economy, liquidating all small enterprises.

As a result

, the local citizens will not be able to open and develop their businesses

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and experience problems with selling goods

due to

a huge competition.

For example

, the coming of large meat industries into Russia forced many indigenous farmers to close their farmlands, since people stopped items buying from them. In conclusion,

although

multinational industries help governments enhance employment and economic rates, they eliminate locally-based entrepreneurs and products.