The Growth of Transnational Corporations and Its Impact on Countries Around the World

The Growth of Transnational Corporations and Its Impact on Countries Around the World

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The Growth of Transnational Corporations and Its Impact on Countries Around the World


A TNC is a company that operates in no less than two countries. An
example of this is Nokia a mobile phone company who are based in
Finland but also have manufacturing plants in Hungary and Bulgaria.
The also make some handsets in Mexico.

TNCs have increased rapidly over the last 30 years or so; this may be
due to a number of reasons. Governments in NIC (newly industrialized
countries) have tried to lure TNC to their countries. One way they
have done this is by keeping the land prices artificially low; this is
so the TNC can build factories and other building for less money. They
also have a relaxed attitude to environmental laws so the TNCs do not
have to pay out for expensive treatments for their waste so it
complies with strict laws like the ones they have in the US, UK and
Japan. Another thing that attract TNCs to NICs is the cheap labour
cost, weak unions and lack of minimum wage. This means that the TNC
can pay workers less, not worry about providing good working
conditions. All of these factors greatly benefit TNCs because they can
produce their products or components for a fraction of a price that
they would have to pay in their country of origin. Another thing that
has enabled companies to spread out over the globe is the fact that
global communications and travel has improved. Emails make it much
easier to communicate with colleagues in other countries and not have
to worry about time differences. Satellite links have allowed people
to have video meetings even if the people taking part are miles apart.
This makes it easier to organise p...


... middle of paper ...


... the other hand many people including employees are supporters of
TNCs because they have improved the life of many people in a lot of
countries who other wise would have had to scrape out an existence in
rice fields of in locally run factories with worse conditions and
poorer pay than they would receive in factories connected with TNCs.

In this essay I have tried to show the good and bad sides of TNC and
also reasons for why their number have increased so rapidly.

In conclusion I feel that TNCs are a mixed blessing to NICs. Its is
good for them socially and economically however from an environmental
view allowing TNC into a country is a big mistake unless the
government tighten laws on treatment of waste etc which I feel they
would not do because they would loose soe of the attraction they have
to TNCs if they did.

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