Advantages of the MNC’s to the host countries: –
1) Raise the rate of investment: – MNC’s raise the rate of investment in the host countries and thereby bring rapid industrial growth accompanied by massive employment opportunities in different sectors of the economy.
2) Facilitate transfer of technology: -Multinationals act as agents for the transfer of technology to developing countries and thereby help such countries to modernize there industries. They remove technological gaps in developing countries by providing techno-managerial skills.
3) Accelerate industrial growth: – multinationals accelerate industrial growth in host countries through collaborations, joint ventures and establishment of subsidiaries and branches. They facilitate economic growth through financial, marketing and technological services. MNC’s are rightly called “ messengers of progress”.
4) Promote export and reduce imports: – MNC’s help the host countries to reduce the imports and promote the exports by raising domestic production. Marketing facilities at global level are provided by MNC’s due to their global business contacts.
5) Provide services to professionals: – MNC’s provide the services of the skilled professional managers for managing the activities of the enterprises in which they are involved/interested. This raises overall managerial efficiency or enterprises connected with multinationals. MNC’s bring managerial revolution in host countries.
6) Facilitate efficient utilization of resources: – Multinationals facilitate efficient utilization of resources available in host countries. This leads to economic development.
7) Provide benefits of R and D activities: -Multinationals has enormous resources at their disposal. Some are utilized for R and D activities. The benefits of R and D activities are passed on to the enterprises operating in the host countries.
8) Support enterprises in host countries: – MNC’s support to enterprises in the host countries in order to support their own operations indirectly. This is how MNC’s support enterprises in the host countries to grow. Even consumers get new goods and services due to the operations of MNC’s.
9) Break domestic monopolies: – MNC’s raise competition in the host countries and thereby break domestic monopolies.
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