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The Successes and Problems of Mnes in Exploiting Paper

The successes of multinational enterprises (Ones) in exploiting the opportunities in merging markets Trade and investment windows have been opened, occasioned by the evolution of supranational institutions and contracts, leading to diminished interference by governments in business affairs, and reduced scope for industrial policy at national or sub-national levels (Armature, 2001).

These bring about a favorable balance of payment for the emerging market, attended by capital Inflows, through final, and intermediate goods export to world markets, service exports, for example, tourism and business travel receipts, and foreign direct investments. The activities of multinational enterprises have stimulated economic growth in host economies, through international trade and foreign direct investments.

Imports, like intermediate goods for local assembly and sale, machinery for local production faceless, and technology transfer have provided an enabling environment for economic growth ( Grossman and Hellman 1991), with the positive, linear relationship between foreign direct investment and technology transfer a pointer of the ‘new growth theory being advocated (Wang 1990, Wall, 1997).

The problems of multinational enterprises (Ones) in exploiting the opportunities in merging markets Multinational enterprises, of necessity, partner with local firms In order to exploit the opportunities presented by the low cost of doing business In an environment whose local policies the given enterprise Is not conversant with, but which is the exclusive purview of the local firm in the host country.

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However, the multinational enterprise stands the risk of losing competitive advantage, as its’ monopoly of the technology that enables it to operate profitably under different business environments could be lost. There are other problems associated with a litigation enterprise’ mode of entry, be It solo, or in partnership. A solo entry could be either a Greenfield mode of entry, or an acquisition of an existing company in the emerging economy.

Both entry modes exert a high cost to the multinational concern. The reader is enjoined to do some research on the problems faced by Ones, in terms of political instability, infrastructural issues, poor technology, unskilled workers, and poor legal frameworks. The special characteristics of Ones from developing nations, and their progress in entering new markets Multinational enterprises Trot developing matrons Dost ten productivity AT mostly Tells .

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