Multinational enterprises and host nation response

Multinational enterprises (MNE's) and their subsidiaries operate in a vast number of countries, and many of them not in homogeneous countries. About 70 percent of the MNE8s and their subsidiaries are found in industrialised or developed countries. Most of the MNE's found in developing countries are to be found in the processing of raw materials or the extraction industry- The international manager is likely to find government policy issue's at variance with the MNE's policies in developing countries more than in developed countries. The countries that make up the developing world are not restricted to the poverty-stricken countries of the world. The wealthy oil producing countries like Brunei Darusalem, Saudi Arabia and Abu Dhabi and the four Asian 'tigers', Singapore, Taiwan, South Korea and Hong Kong, belongs to the class of newly industrialised countries, are all part of the developing world. This paper will consider, those arguments that favour and those that oppose the involvement of MNE's in host nations, the sources of MNE and host nation bargaining power, and the causes of power shift between the MNE and the host country. In the final part of this paper, issues the MNE has to consider, to maintain its continued presence in the host country will be discussed.