It is often argued that the actions of huge global companies are beneficial to countries with developing economies, while others believe that these companies have a negative effect. In my opinion, I believe that although multinational companies have some harmful impacts, overall they benefit the countries in which they do business.
A growing body of research suggests that multinationals have a generally positive effect on the economies of developing countries. One key benefit is that international investment can help to create job opportunities for local people. This can lead to an increase in wages. Taking Turkey as an example, employees of multinational companies earn around 15% more than staff of local companies. While wage growth is only one indicator of economic health, it is clear that international companies can contribute to a country’s development.
However, there are also negative impacts which must be considered. One important issue is that multinational companies can take customers from local companies. This means that some local businesses are likely to close down. For instance, global chains such as McDonalds and Coca-Cola have a much larger budget for advertising, allowing them to increase their market share at the expense of local restaurants. Although increased competition is often seen as an essential driver of economic growth, it can be argued that these large companies have an unfair advantage over smaller businesses, which can tead to the formation of monopolies.
In conclusion, while multinationals can benefit developing countries through creating jobs. They can also threaten small businesses. In my opinion, despite having some negative effects, I believe multinational corporations are generally beneficial. However, I would argue that governments should regulate their impact in order to protect and support local businesses.