Multinationals and globalization : relationships with States

Abstract

This article deals with multinational corporations (MNC) as actors within the international system, in the era of globalization, free trade and worldwide commercial markets. Even though MNCs represent only a fraction of total employment, they are important because of their adaptability to globalization and as a channel for direct foreign investment (DFI) pursued both by developed and developing countries. At the same time, MNCs are subject of discussion in issues such as: effects on competition and local markets, relationships with Governments both of headquarters and of host countries, and recent developments in labor and environmental issues. There is also a growing but minority trend of transnationalization and DFI by corporations of developing countries. The analysis focuses on Latin America - and «translatin» corporationsand Chile, with its open economy and trade agreements, and some suggestions are offered so that these countries and their peoples can take advantage of globalization and multinational activity.