The following are some of a multinational company’s drawbacks:
High-Profit Low-Risk Investment: Multinational companies seek to invest in high-profit, low-risk sectors. They give less attention to issues like social welfare, national priorities, and so forth. They mostly invest in the consumer products sector.
Political Meddling: Multinational corporations from affluent countries meddle in poor countries’ political issues. Multinational corporations have bribed political officials numerous times in order to advance their own financial interests.
Artificial Demand Creation: These businesses utilize a lot of advertising, promotion, and other strategies to artificially and unjustifiably increase demand.
National Threat: Domestic enterprises occasionally employ outmoded technology, which degrades the value and cost of their goods and prevents them from competing with those global firms. Consequently, there is a risk of widespread opposition to the international corporation. The introduction of these businesses fosters a climate of uncertainty for the domestic sectors.
Impede their Culture: Multinational corporations pressure emerging nations to adopt their culture. They indirectly impose the culture of industrialized countries along with the products. The fast food and soft drink cultures have been imposed by these corporations on underdeveloped countries. Examples include a burger and a soda.
Work for Self Interest: International businesses prioritize their own interests over the growth of the host nation’s economy. They are more focused on making as much money as possible through marketing.
