Question

What are the harmful effects of mnc to a host country give 3 example

Answer 1

Impact of multinational companies on the host country AO3

S:\TripleA\DP_topic_packs\business management\student_packs\articulate_interactions\images\multinational_hands.jpgMultinational corporations can provide developing countries with many benefits. However, these institutions may also bring with them relaxed codes of ethical conduct that serve to exploit the neediness of developing nations, rather than to provide the critical support necessary for countrywide economic and social development.

When a multinational invests in a host country, the scale of the investment (given the size of the firms) is likely to be significant. Indeed governments will often offer incentives to firms in the form of grants, subsidies and tax breaks to attract investment into their countries. This foreign direct investment (FDI) will have advantages and disadvantages for the host country.

Answer 2

(i) MNCs are profit driven and are less concerned for the development of the host country.

(ii) The technology used are capital intensive and expensive which are not suitable to a developing country.

(iii) In some instances, labour laws are not properly implemented and the workers do not get their rights.