Foreign Investment

ere is my question: 1)What atomic number 18 the dangers of relying on contrasted multinationals for economic growing? What should a nation do to switch over by reversal such imbalances? give thanks!to garter me etutor answers: MNCs ar, of course, of enormous benefit to countries, and particularly the UK. Overseas investiture in the UK now exceeds £370B, more of it coming from the US and the EU, and much of it focal point upon manufacturing. Hence MNCs contribute 25% of the UKs manufacturing tabooput, 35% of man. investment and 30% of our visible exports. The drawbacks are as fol low-spiriteds: 1. MNCs look for low greet locations and/or places where market access is easy. The UK fits the bill truly headspring - low business taxes, cheap sites, relatively hardly a(prenominal) regulations, weakish unions and lowish fight costs, tariff-free access to EU markets. But ny of this can intensify - and so MNCs can then recon locatingr their strategy, and pull o ut at short notice. The effect on national issue and purpose could then be very severe. 2. Though thither is a lot technology transfer (i.e. domestic firms copy the advanced working practices comprise in most MNC plants) the more uncompetitive firms are possible to be taken over, or else may have to button up down, resulting in unemployment, and still greater dependency upon MNCs for domestic growth. 3.

altogether of the profits made by the MNCs in this country are repatriated to the parent company overseas - this is a net pip on the invisible account of the balance of payments. 4. Any ceding back in the MNCs home countr y is likely to see a cutback in overseas ope! rations, as confidence, sales and funds change out up - many US companies are soon discriminating back on their overseas investments. In belief a nation needs to resort to supply side policies to correct such imbalances - in other words policies knowing to recruit the growth of domestic firms, and thus reduce the doctrine upon MNC plants. such(prenominal) policies might include: privatisation, opening up of monopoly markets to greater...If you want to go through a full essay, order it on our website: BestEssayCheap.com

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