The diplomacy of multinational corporations (MNCs) : bargaining with developing states

Van Zyl, Stefan Daniel
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Stellenbosch : Stellenbosch University
ENGLISH ABSTRACT: This assignment investigates the bargaining relationship between multinational corporations (MNCs) and developing countries. The units of analysis of this study in Global Political Economy are MNCs (non-state actors) and nation-states. In the contemporary global production structure the 'balance of power' between MNCs and developing countries has shifted in favour of MNCs. Descriptive secondary sources were used to illustrate the MNC-State bargaining relationship in telecommunications privatisation in Sub-Saharan Africa. In the contemporary global economy nation-states only rarely still compete for territory, but rather for wealth-creating activities to be located within their borders. Important changes in the global production structure have resulted in the increased mobility and economic power of MNCs. These developments have affected the strategic relationship between MNCs and nation-states and the former have used their advantage to gain preferential treatment in the bargaining process. The nation-states are also competing amongst themselves for the investment and technology and knowledge transfers from these firms. Privatisation programmes in Sub-Saharan Africa have substantially increased MNC participation on the continent, which has been historically marginalised from global foreign direct investment receipts. Research has shown that MNC participation in infrastructure service provision is more efficient than government ownership. However, this does not constitute a loss of sovereignty, but rather emphasises the changing role of nation-states as facilitators of global market relations. On examination, the distinct bargaining relationship in telecommunications privatisation clearly illustrates the dependence of Sub-Saharan African countries on technologically advanced MNCs. Thus, the 'balance of power' has shifted more to MNCs in the global political economy.
AFRIKAANSE OPSOMMING: Hierdie navorsingswerkstuk ondersoek die bedingingsverhouding tussen multinasionale korporasies (MNKs) en ontwikkelende lande. Die ondersoekeenhede in die studie van die Globale Politieke Ekonomie is MNKs (nie-staatrolspelers) en regeringstate. In die huidige globale produksiestruktuur het die mag tussen MNKs en ontwikkelende lande verander sodat die MNKs nou die magsoorwig het. Beskrywende sekondêre bronne is gebruik om die MNK-regeringstaat se bedingingsverhouding in telekommunikasie privatisering in Sub-Sahara Afrika te illustreer. In die teenswoordige globale ekonomie kompeteer regeringstate selde met mekaar om territoriale mag, maar oorwegend om welvaartskeppende bedrywe binne hul grense aan te moedig. Belangrike veranderings in die globale produksiestruktuur het MNKs se mobiliteit en ekonomiese mag verhoog. Hierdie ontwikkelinge het die strategiese verhouding tussen MNKs en regeringstate verander. MNKs gebruik hierdie invloed om voordeel te trek uit regeringstate wat kompeteer vir belegging en die tegnologie- en kennisoordrag van hierdie korporasies. Privatiseringsprogramme in Sub-Sahara Afrika het MNK-deelname op die kontinent verhoog, wat histories gemarginaliseer is van buitelandse direkte belegging. Navorsing dui daarop dat MNKs se deelname in infrastruktuurdienslewering meer doeltreffend is, as wanneer dit onder staatsbeheer is. Dit lei egter nie tot 'n verlies aan soeweriniteit nie, maar beklemtoon die regeringstaat se veranderde rol as fasiliteerder van globale markverhoudinge. Die ondersoek na die uitsonderlike bedingingsverhouding in die privatisering van telekommunikasie beklemtoon Sub-Sahara Afrika se afhanklikheid van tegnologies-ontwikkelde MNKs. Die magsbalans het gevolglik na die MNKs oorskuif in die globale politieke ekonomie.
Thesis (MA)--Stellenbosch University, 2004.
International business enterprises -- Developing countries, Collective bargaining -- International business enterprises -- Developing countries, Telecommunication systems -- Economic aspects -- Developing countries, Investments, Foreign -- Developing countries, Dissertations -- Political science, Theses -- Political science