The paper explains the impact of multinationals on developing countries in detail. It gives wide explanation on how MNC’s affect the developing countries in positive and negative ways. It enlists number of advantages and disadvantages of Multinationals on developing countries. Furthermore, it explains that what measure Unilever in India, Nestlé in Bangladesh and Colgate Palmolive in Pakistan have taken to operate effectively in these respective regions.
MNC’s can shift their production locations easily. This gives them control on the government since the government doesn’t want them to shift (Leonard, 2005). They can put up their terms and conditions to the government, and if the government doesn’t respond to them, they can threaten them by starting to shift their operations.
Also, MNCs often pressurize the government. They have an influence of the political leaders and their policies.
Summarizing it, that MNC’s impact is positive as well as negative too. It depends that what is the objective of the government. If the government wants the economic development of the country, then MNC’s are the best option for that. But if the government wants to eradicate poverty, provide well being of the citizens and protect the environment then MNC’s have hazardous affects.
If the examples of Colgate Palmolive in Pakistan, Unilever in India and Nestle in Bangladesh are to be considered, then it can be seen that these multinationals have greatly impacted the technological progress, industrial infrastructure and corporate efficiency.
Technological progress itself requires the industrial infrastructure, the receptiveness of management, entrepreneurship, government policies etc (Grog, 2001). The MNC’s have greatly worked hard in these areas to operate efficiently in these respective developing countries. The MNC’s have transferred technology from their parent companies. But it required the workers understanding of that technology (Grog, 2001).