Describe how TNCs influence the location of manufacturing industry.

The first 200 words of this essay...

a). Describe how TNCs influence the location of manufacturing industry

(20 marks)

Transnational Corporations (TNCs) are companies that operate globally. They usually are based in MEDCs but have branch companies all over the world. TNCs control vast amounts of world trade, only 74 firms, with 50% of trade via TNCs in America and 80% via Britain, generates 12.5% of total world production. Examples of well-known TNCs are Nike, Coca Cola, Nestlé, Sony, Ford, General Motors and Mc Donald's. Companies became multinational through Foreign Direct Investment (FDI). In the 1960s and 1970s, the economic recession, meant that profits dropped so companies became TNCs in order to expand and reduce costs. The Gross National Product (GNP) of a TNC is great, for example the GNP of Mexico is 142 compared to the TNC General Motors being GNP 127 and the GNP of Denmark is only 93 compared to Ford's, which has a GNP of 97.

TNCs dominate the economy of both their home countries and most of the economy in Less Economically Developed Countries (LEDCs), where they choose to invest. Due to this their economic and political power is immense. They are the most advanced system, which