Ledcs Face Along With The Advancement Of Globalization

So far, we focused on the advantages that LEDCs face along with the advancement of globalization, however, the advancement of TNCs in LEDCs is not always advantageous and is actually disadvantageous mainly in economic and social aspects. We must realize that if we focus solely on our earnings, we are overlooking other dimensions of developing countries that may be in a disadvantageous situation. For example, profits earned by TNCs are often brought back to the company's home country, causing severe leakage of capital in the LEDC. Despite the high potential LEDCs have for further development, TNCs have derived huge benefits by outsourcing their

The development of free trade has become more controversial since the end of the

Second World War due to rising openness to other countries and cultures. In terms of trade, globalization refers to 'as increasingly borderless trade that develops between countries and territories or countries and countries' (Archana, 2015). Along with the growing inter-connectedness of the world, the liberalization of trade policies has favored globalization amongst many countries and has led to an introduction of new agreements such as trade blocs in which several countries make an agreement to eliminate protectionist measures such as tariffs and quotas to facilitate the flow of goods and services. Easier transportation of goods and services across borders has reduced unnecessary costs which made the cost of goods themselves cheaper and more accessible. NAFTA is a good example of the situation where several countries agree to a partnership that makes imports and exports less costly.