In recent years, the operation of big corporations is ubiquitous in developing nations. The essay will first suggest that economic growth is the prime benefit, while the excessive use of emergent nations’ natural resources is the main drawback.
One evident benefit of the operation of transitional companies in less developed countries is the prosperity of the local economy. That is to say, multination companies provide an inflow of capital into developing countries. This investment not only creates job opportunities for the people in developing nations, but it also helps to build better infrastructure, such as bridges, roads, and transportation facilities, for them. For example, the role of Foreign Direct Investment in the year 2010 was undeniable because it uplifted the Indian economy so fast and increased GDP and created so many jobs for locals.
The prime disadvantage is that these companies use the natural resources of developing nations recklessly, which affects the environment. In other words, Smaller, less developed governments often trade an increase in revenue for access to natural resources. This extraction of raw materials, such as oil, diamond, rubber and fuel, can cause environmental externalities- polluted rivers and loss of natural landscape. For instance, many Chinese private enterprises have been heavily criticised for using the resources of countries like Vietnam, Thailand and the Philippine and for polluting the environment.
In conclusion, huge global companies benefit less developed nation economically is the prime advantage of this, and the extraction of raw materials for the sake of profit is the main disadvantage.