Th4.5: Transnational Companies

Question 1

What are the benefits of TNCs?

Answer 1

they can bring huge gains to an economy through their creation of jobs, the tax revenue they raise, the knowledge they bring and the investment they undertake

Question 2

What negative economic and social impacts can TNCs have?

Answer 2

destroy local culture, affect the environment and withdraw more in profits than they inject through investment

Question 3

What kind of history do TNCs have with politicians?

Answer 3

have history of influencing politicians to take decisions that will favour their interests and are involved in tax avoidance

Question 4

Some developing countries don’t allow TNCs to set up in their country without first…

Answer 4

setting up a joint company with a local partner, meaning some profits are retained within the country and knowledge/tech is transferred

Question 5

Many governments use ….. with TNCs, meaning…

Answer 5

use import contracts with TNCs meaning that at least some part of the value of the order must be manufactured in the country