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MNC/FDI MindMap - Coggle Diagram
MNC/FDI MindMap
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Disadvantages
of MNC/FDI
MNCs like Apple and Google have been accused by political figures in the US and EU for not paying their fair share.
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The world media has focussed on tax avoidance,
particularly those done by powerful MNCs.
If multinationals (MNCs) can avoid taxes in nations with strong legal systems, it may mean that less developed countries have little chance of collecting their "fair share" of taxes from MNCs.
- Environmental
Destructions
MNCs are considered suspicious by many environmentalists because they could cause environmental damage.
The reason is because MNCs have a large presence in the extraction areas, namely coal, oil, and gold mining.
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Profits also are sent back to the nation where the MNC is located. As a result, the nation suffers.
This shows that MNCs help developed nations more than less developed nations. since the majority of MNCs have their headquarters in industrial countries.
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Advantages
of MNC/FDI
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MNC provide skills and motivation (encouraging locals
to supply services, transport, cleaning, etc).
GIving technical help,
training to gain skills.
To attract MNCs, less developed countries
started to spend more on education.
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When a business sets up a facility like a factory,
they're likely to install up-to-date technology or
produce something new like the producer of BMW.
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If MNCs/FDI didnt operate business
in such countries, the valuable source
of revenue wouldn't have existed.
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- More investment
in infrastructure
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Owing the attractiveness of MNCs/FDI,
governments are more likely to invest
in infrastructure to attract investors which can benefit.
When MNCs arrive, they will establish factories,
warehouses, shops, and other business facilities.
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Local suppliers are likely to get work,
also for the workers, the jobs created
by FDI are often good and pays high wages.
Living standard can be improved there
because of the improvement of outpput
and employments (improved economic growth).
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