Multinational Enterprise (MNC)

What is Multinational Corporation or Multinational Enterprise (MNC)?

A multinational corporation (MNC) is an enterprise that engages in foreign direct investment (FDI) and that owns or controls value-added activities in more than one country. It is not multinational if it just engages in overseas trade or serves as a contractor to foreign firms. There are many characters to assessing a degree of multinational of a specific firm. For example, a firm that have many subsidiaries in foreign country or operate in a many kind of countries around the world weather it least developed or a developed countries. Normally, a multinational corporation finance some of their overseas operation by transferring funds from the country of the headquarters firm

There are different challenges and problem that need be faced by multinational corporation if their want to operating in the least development countries because different countries has a difference problem. We can take one countries as an example, such as Madagascar. Madagascar is a fourth biggest island in the world that located in the South Africa, east of Mozambique. Madagascar is listed by the United Nations as one of the world 48 least developed nations. (United Nations Industial Development Organization).

There are many issues that need to be faced the first issue is in level of economic development. According to Frederick D. S. Choi and Gary K. Meek, level of economic development factors is affects the types of business transactions conducted in an economy and determined which ones are most prevalent. The type of transactions will determined the issues that will be faced. (Meek, 2011). According to Madagascar Country Report 2014, for the last thirty year, Madagascar has a weak growth and fragility macroeconomic because of the repeated political crisis. In between 1980 and 1995, average GDP growth was less than 2 per cent and it has improved at late 1990s. A significant growth was shown in between 20014 and 2008, with a growth of 7.1 per cent in 2008. In 2009 there are political crisis happen and make the economy dropped to negative -4.6 per cent before returning to positive growth at 1.6 per cent

There are many kind of wildlife. So take these opportunities and focus on tourism. Tourism nowadays attracts more in traditional of a country. They usually want to experience how the living, the culture, and the nature of a countries. If a multinational corporation want to invest or make some branch these will help the growth of economic in Madagascar, also help in improving the infrastructure and some renovation to that country so the tourist will attract and feel ease when visit the country because of good environment and condition infrastructure in that country.

Other than that, Madagascar should offer the tourist an experience to see a wildlife that can be found in there. That is because Madagascar is rich with its own wildlife. They can open a wildlife park as an attraction to a tourist that visit the country. This also will help to improve Madagascar economic and also will attract more multinational organization to open a branched or to invest in that country because they know the future of Madagascar if the government focus on the