The Allure of the Developing World to Multinational Enterprises - Research Paper Example

The developing countries have also benefitted through the development of industries within their countries. For example, the French multinational company, Arc International has developed production industries in countries such as South Africa, Brazil, and India along with certain other countries in Africa such as Angola. The actions of the multinationals in the developing nations have brought about increases in the country's growth rates as a result of the taxes they pay their hosts (Poel, 2011).

            The activities of the multinational companies in the developing nations have seen the discovery of various products that were previously not known to be existing in them. For example, the activities of several oil multinational companies in countries such as Brazil, Kenya among others (Poel, 2011). However, multinational companies have encountered problems in the quest to invest in developing nations that have constantly increasing rates of inflation, energy, and food prices.

Despite the fact that multinational companies have also experienced growth in their own economies due to their activities in the developing nations, they face high political and economic risks in these countries (Poel, 2011). For instance, multinational companies such as the oil companies who have been heavily investing in the Middle East and the North African region face the above-stated problems. This is due to the recent political uprisings that the countries within the region have encountered (Poel, 2011).