Why did mncs begin to shift their production centres to asian countries? What were it's effects?
Answers
Explanation:
(i) MNCs shifted their production units to Asian countries because of cheap labor and low wages. (ii) Availability of raw materials and a large market. (iii) Effects: It stimulated world trade and flow of capital. Countries like India, China, and Brazil underwent rapid economic transformation.It generated employment opportunities and introduced competition in the domestic
Answer:
(i) MNCs shifted their production units to Asian countries because of cheap labor and low wages. (ii) Availability of raw materials and a large market. (iii) Effects: It stimulated world trade and flow of capital. Countries like India, China, and Brazil underwent rapid economic transformation.It generated employment opportunities and introduced competition in the domestic markets.
Explanation:
Wages were relatively low in Asian countries. Thus, they became attractive destinations for investment by foreign MNCs competing to capture world markets. The relocation of industry to low-wage countries stimulated world trade and capital flow.
Impact of MNC’s decision to relocate production in Asian Countries:
1. It provided for cheap labour to MNC’s
2. It stimulated world trade and increased capital inflow in the Asian Countries
3. Brought about new technology and production methods to the Asian Countries.
4. Greater choice of goods and services to the people with greater employment opportunities for Asian countries.
5. Rapid economic transformation resulting in the growth of economies like India, China.