: What effects do multinationals have on the economy of the country that they are situated in?
Multinationals have an adverse effect on the economy of the country they
are situated in. They usually invest a liitle i.e bring in a small FDI,
raise capital through local financial institutions and loans and go on to
amass huge profits through rigorous advertisements. The company then siphon out the profits from the country they are doing business in by way technology fees(?), royalty, proportionate profits(?) etc. They usually invest in the fast moving consumer sector and destroy local small scale industries
which are essential in a developing country. MNCs often trade in products that have been banned in the developed countries. These are a few examples of how harmful MNCs can be ! You can get back to me for more facts.