Outsourcing by MNCs has been crucial to industrial development of economies and maintaining profitability of MNCs. Is this a win-win situation for all parties?

Essay by kristy_granger July 2006

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Question: Increasingly, outsourcing of industrial operations by multi-national companies has been crucial to the industrial development of developing economies and maintaining the profitability of multi-national companies. To what extent do you see this as a win-win situation for all parties concerned in industrial outsourcing?

I agree that this is a win-win situation for all parties concerned in industrial outsourcing to a large extent.

When the multi-national companies build their factories in other developing countries like India and Indonesia, they help the host countries by providing the locals there with jobs. The increase of jobs due to the companies will help the country and it's government a lot by reducing their percentage of jobless people.

When the locals in the host countries work in a multi-national company, they will have a guaranteed income. This means that the companies help the government with their countries' poor families, giving them a reliable source of income.

The local workers will probably have a steady in come all the way until they leave the company.

Also, when multi-national companies outsource to the developing countries, they bring with them technological information and new technology. When the locals go to the multi-national companies to work, they gain working experience and they learn the efficient methods that the multi-national companies use in their companies. When they leave the company to work at a local company, they bring along their methods of working and teach it to the new company, letting local companies learn the better ways of working. The host countries will then be able to gain from the multi-national companies by learning new technological information. This will help them to improve their industries' and factories' production rate, thus increasing their profits and helping their country become richer.

The government of hosting countries also gains taxes from...