Mncs In Nigeria Swot Analysis

existing capital form them. For example, according to Pinto and Knakel (1973), the profit repatriation between 1960 to 1968 by MNCs from Latin America to the parent companies in the United States exceeded new investment by $6.7 billion in total . It means that the initial investments owned by the local firms are now diverted to the parent corporations in the developed countries. Beside that, Bornschier and Ballmer (1978) stated that the number of inequalities is high in countries where high MNCs investment are presence and vice versa .

Analysis

Thus, there are several general benefits and criticisms of MNCs that can be evaluated in order to determine whether it is a predator or ally to the third world economic development. First and foremost,

The negative one in the less developed countries has always been most intense as compared to developing or other developed countries. Africans’ public officials and individual criticisms against the policies of international corporations have been vocal and loud on the negative drawback of their economic well being and the development of Africa, said Giplin (1987) . According to Akor (2001), notwithstanding of the ‘Nigerian Indigenization Policy ’ in the 1970s, the activities of the MNCs in Nigeria have maintained and intensified the contradictions of underdevelopment in many ways . Thus Onimode (1982) carried out empirical analysis to show the impact of MNCs on the Nigerian economy. Firstly is the profit repatriation. Onimode (1982) argued that most of the profits made in Nigeria will not be invested in the country but yet to sent to the parent countries of the MNCs for investment, thus causing Nigeria industrially underdeveloped . Secondly is the structural distortion. MNCs’ nature of operation is to be open and have to ability to choose their locations and productions. In Nigeria, MNCs are usually prone and leaning toward to be base in the urban such as Kaduna, and Enugu because these places are mainly consists of oil and consumer goods. Therefore, the urban concentration has distorted the societal structure by boosting an uneven development. The third negative effect of MNCs in Nigeria would be the political instability. According to Annan (1998), violence and instability erupts either because some elites crave a larger share of the spoils controlled by the leader or because those outside the leader’s support-based coalition want access to resources to which they have been denied . A stable ‘capitalist’ government is crucially needed for the MNCs to survive; as a result, they will try to protect the existing government’s status quo from the