I believe that transnational companies have not worsened the global economic inequalities. I will support the argument by discussing how TNCs have contributed to improve the local economical status, using an example of Vietnam.
Firstly, TNCs have helped to improve overall standard of living and reduced poverty in Vietnam. Most of the TNCs started to come in to Vietnam in mid-90’s.
In 1990 which was before most of the TNCs came into Vietnam, Human Development Index, an indicator that shows both of social and economical development in numbers from 1 to 0, was 0.61. However, in year two thousand (2000), the HDI value had increased up to 0.71.
Moreover, according to World Bank, 58% of total population were living below the poverty line in 1993, where as it was 15% in 2007.
Even though there are many other factors that are responsible for these economical developments, these statistics suggest that TNCs have contributed to improve the standard of living and reduced poverty in Vietnam.
Secondly, TNCs have socially helped the local community, which consequently result in economical developments. Example of this is Toyota Motor Vietnam Company, which was founded in 1995, just like other TNCs in Vietnam. In 2005, Toyota Motor Vietnam established “the Toyota Vietnam Foundation”. The Foundation has so far made a “creative course” in Hanoi University of Technology to train an industrial leader for the next generation. It is also providing scholarship for college students. Furthermore, the foundation has also carried out “Road safety education program” to elementary school students in the whole country.
In this way, Toyota, one type of TNC, is offering a social support to Vietnam in terms of education. As you may guess, provision and access to higher education helps the economy to grow, because it trains professional workers.
To sum up, as it is in Vietnam, TNCs have supported local communities in terms of standard of living and education, which have...