How/ why do Multinational companies exist?
Answers:
Multinational companies exist (and often flourish) because they are able to use many resources and people to accomplish their goals and do it more cheaply and more efficiently than other companies.
And contrary to popular belief, many multinational companies do not exploit workers in other countries. In fact, multinational corporations account for some of the highest-paying jobs in third-world countries, so the workers there practically beg for the opportunity to work there. If they were being exploited, they wouldn't bother to work there in the first place. Multinational corporations therefore provide good-paying jobs for third-world countries, while keeping their production costs down, therefore transferring the savings to consumers through cheaper products. Countries that have embraced multinational corporations have growth rates of 5% or more per year, compared with 2% in Western countries and 1% to negative growth in countries who have not accepted free trade.
To present a diversified front and better able to hide their profit margins. It also gives them a foothold to expand their holdings and buy/sell rival companies and outsource cheaper manufacturing.
They exist to do business in other countries. Not onlt must they comply with their original countries laws, but they must pay taxes and obey all laws of any countries in which they do business. Example. IBM builds computers.They build boards in Japan, put them together in China and sell the units in the US. Each one of these steps involves seperate business entities in each country, under one banner. Easy Huh?
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