What is the Role of MNCs in the Globalization Process?

By BYJU'S Exam Prep

Updated on: November 9th, 2023

MNCs play a significant part in the globalization process since they not only sell their products abroad but also manufacture them elsewhere. Minor parts of the manufacturing process are dispersed across the globe. Global business and development convergence is the outcome, distribution of technology, goods, services, and resources.

Role of MNCs in Globalization Process

MNCs are significant participants in the process of globalization. They also work closely with local and small producers to integrate markets while they are far away. Their efforts improve international ties by promoting investments and global trade in goods.

  • Nations become more interconnected through the rapid global economic integration process, sometimes known as “globalization.”
  • Globalization has boosted international trade and communication. The silk road is one such historical example.
  • Globalization has increased significantly over the past 20–30 years as a result of the expansion of MNCs.
  • MNCs, or multinational firms, have production sites located across several different countries.
  • MNCs choose locations for their manufacturing plants that have access to cheap, plentiful labour, are close to markets, and have favorable political climates.
  • The MNCs are interconnecting the economy of various nations by producing and selling in numerous nations, accelerating globalization.


What is the Role of MNCs in the Globalization Process?

MNCs play a crucial role in the globalization process. In order to integrate the markets despite their distance, they also have direct interactions with surrounding small and regional manufacturers. Their initiatives foster investments and cross-border commerce of goods, which strengthens international ties.

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