Multinational companies are becoming increasingly common in developing countries. What are the advantages and disadvantages of this?
It is becoming more popular in developing nations to see multinational corporations. There are some benefits for this trend such as the progress in the economy they create in these countries and the availability of jobs, however, the shut down of some small local businesses and the lower selling rate of local products can be its drawbacks.
The main advantage of the increasing number of these types of companies is the economic progress. That is to say, if multinational organizations operate in less-developed nations, this can bring wealth which boosts industries, trade, and other aspects of the economy. Moreover, more jobs will be available for the local people. That is because more workers and managers are needed to work for these companies which can be a good opportunity for locals to find a job. For instance, after opening a branch of Apple company in Dubai, many local graduates were thrilled by the good news of being accepted to work under this renowned company.
However, one of the main disadvantages of this trend is the drop in the selling rate of the local products. That is because of the good reputations and qualities of international items, and, thus, citizens might refrain from buying their local products. Another disadvantage is that some small local shops could be closed. That is due to the unfair competition with these huge strong establishments, and as a result, some might be shut down or go bankrupt. For example, many amateur Syrian entrepreneurs, and after the harsh competition they had with international textile corporation, were forced to close their fabric factories.
In conclusion, although the advantages of the popularity of multinational organizations in developing countries are the economic progress and the improvement in the job market, nonetheless, its downsides are the drop in the average selling of local products and the closure of some small businesses.