The Pros and Cons of Mncs in Chinese Market

Multinational Corporation - business enterprise with manufacturing, sales, or service subsidiaries in one or more foreign countries, also known as a transnational or international corporation. These corporations originated early in the 20th century and proliferated after World War II.

The precise structure of inactive investment in a foreign nation depends largely on the treatment of the structure under the tax laws of the host country and the U.S.

Second, China is facing strong competition in low-end manufacturing, like Mexico, Cambodia, Laos, India and Vietnam. Asian countries like Cambodia, Laos, India and Vietnam have a lower living cost than China and Mexico has geographical advantage since it is closer to America. And fast-paced inflation, the increasing cost of raw materials, the rise of wages and other costs have pushed China to a less competitive position.

According to the case we know that labor costs in china may have a big increase in the next 10 years, from 40% totally to 10% annual increase to even 40% annual increase.

China’s production cost are dramatically lower because of less strict regulations, but also because of a larger population that all need to be employed.

Multinational corporations are companies that have branches and operations in two or more countries. These companies are the main results of globalization, since they operate all over the world as if it was one country. Multinational corporations have a home country which contain their headquarters and offices for management and have host countries in which their operations take place. The home countries of multinational corporations are usually developed countries that have great capitals and the host countries are developing countries due to the low costs of labor, raw materials, and taxes paid to the governments.

Multinational corporations is an organization that doing business activities and operating in two or more countries. In the next explanation, multinational corporations will be called as MNCs. Home country is where the MNCs is coming from. Host country is a country where the MNCs operates outside the country where it is based.

The rapid development of economy promotes the development of multinational companies, which have become a general form rather than a special form of a company. Multinational companies carry a lot of money, production technology, management expertise and sales channels to expand their business around the world. There is no doubt that multinational companies will become the subject of an act of international relations and play an increasingly large impact on international relations.

In terms of geographical breakdown of exports, China's major trading partner is Asia accounting for around 51 per cent followed by USA 22 per cent and Europe per cent.

The Chinese are an emerging economy that has taken over the world's production in recent years. In fact China is now considered to be the world's factory, as all the major players in the world outsource all or some of their manufacturing activities to the country. All this would not have been possible without the help of technology and with the state of globalization being such, that logistics and distances are becoming shorter and shorter.

The main advantage of doing business in China is the fact that China has emerged as one of the world’s strongest economic forces, driven by the shear number of

Globalization Operation, from the 1990s became the buzzword. With increased trade, investment and international financial capital flows, the world economy is undoubtedly steadily toward globalization. Foreign goods purchased by consumers increased, more and more transnational company, people feel the world is getting smaller, more intimate contact with each other. Following by China's reform and opening the market, China's growing economic strength and international competitiveness of Chinese enterprises is also rising, the number of multinational companies have increased, but there are still less competitive and dynamic issues such as inadequate in the development process . This article on how big of multinational companies

A multinational corporation (MNC) is a corporation that operating in two or more countries, known as host countries but managed from one country, known as home country. Multinational Corporation is also known as international corporation (Wikipedia, 2011). Besides that, MNC can be defined as a corporation that derives revenues from operations in countries other than home country (BusinessDictionary, 2011).

Multinational Corporations (MNCs) are big corporate business that produce goods and services in more than one country, including its home country. An MNC can operate in very many countries and most often, they hire labour from the exact same country they choose to operate in. These companies normally operate in host countries where they can find cheap labour or numerous unexploited resources which they are unable to find or have already been depleted in their home countries.

There are various definitions of a multinational enterprise. Broadly, a multinational enterprise or a multinational corporation (MNC) refers to a giant firm that owns the production of goods or services in many countries other than their home country. David E. Liliental, defines the MNCs as "corporations which have their home in one country but operate and live under the laws and customs of other countries as well." According to Franklin Root (1994), an MNC is a parent company that engages in foreign production through its