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

Recent human advancements resulted in many changes in business and commerce worldwide. Multinationals have been increasing their presence globally including nations in development as potential markets.

This

brings benefits to countries' economies and creates new jobs, but there are

also

some disadvantages as it can affect local businesses and create economic dependence. On the one hand,

multinationals'

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expansion is undoubtedly advantageous to countries' development since having international organizations present in different communities creates new job opportunities.

Furthermore

,

this

benefits the country’s economy. A good example of

this

figure happened in Brazil when Ford announced that they were establishing three new factories in different states during the 2000s. The establishment of the global brand not only generated thousands of jobs but

also

contributed to a substantial increase in car sales that contributed significantly to economic growth.

Nevertheless

, global companies' presence is not totally positive. Big brands,

for example

, usually invest a large amount of money in marketing to lead market sales.

As a result

, people prioritize their stores when purchasing items, which impacts local establishments. With sales declining and fewer resources to compete with bigger businesses, many local enterprises end up closing down.

Besides

that, there are realistic risks if multinationals cease operations in the country because the sudden job loss would affect the community drastically.

This

means that the country’s financial system would be negatively impacted. In conclusion, multinational enterprises contribute to economic growth and create job opportunities in developing countries, but can

also

negatively affect local businesses and create a dependence that can impact communities when they take drastic actions like closing operations.