Question

Why did the MNCS decided to shift their companies to Asian countries?
chapter:- making of a global world HISTORY
NO SPAMS​

Answer 1

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:

• It provided for cheap labor to MNC's It stimulated world trade and increased capital inflow in the Asian Countries

• Brought about new technology and production methods to the Asian Countries.

• Greater choice of goods and services to the people with the greater employment opportunities for Asian countries.

• Rapid economic transformation resulting in the growth of economies like India, China.

Answer 2

MNCs decided to shift their companies to Asian Countries because......

(i)Wages were relatively low in countries like China. Thus they became attractive destinations for investment by foreign MNCs competing to capture world markets.

(ii)Most of the TVs, mobile phones, and toys seen in the shops are made in China, this is because of the low-cost structure of the Chinese economy, most importantly its low wages.

(iii)The relocation of industry to low-wage countries stimulated world trade and capital flows. In the last two decades the world’s economic geography has been transformed as countries such as India and China have undergone rapid economic transformation.

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