4.4.1 The impact of MNCs

Question 1

What do MNC’s impact in the local economy?

Answer 1

local labour, wages, working conditions and job creation

local businesses of the local community and environment

Question 2

What do MNC’s impact in the national economy?

Answer 2

FDI flows
balance of payments
technology and skills transfer
consumers
business culture
tax revenues and transfer pricing

Question 3

What benefits could employees get from MNC’s?

Answer 3

Better training (Upskilling?)
Better pay

Question 4

How do MNC’s affect local businesses?

Answer 4

• Increased competition (Price pressure)
• Increaed competition for employees
• Wages will have to rise in order to compete
  + Oppertunities to supply (support services)

Question 5

How do MNC’s affect the local community?

Answer 5

+ More Employment (Direct, Indirect)
+ Less unemployment
+ More consumer Spending because more emplyoment
- Environmental impact (Polution, Waste)
- Loss of identity (Scocial Cohesion, Loss of culture)
+ Enforced improvements

Question 6

How do MNC’s affect the Government?

Answer 6

+ Less unemployment (Leads to more tax (Income and Value added tax))
- Tax avoidence (Transfer Pricing)
Leads to less money, leads to less GDP, leads to less spending…

Question 7

How do MNC’s affect the Customers?

Answer 7

\+ Cheaper
\+ Conveience
\+Innovation
- Less choice
- Lack of competition
\+ Better Qualitity