CHAPTER ONE
BACKGROUND OF THE STUDY
1.1 INTRODUCTION
National or domestic business not withstanding there is a literally a whole world out there for business to deal with. Just imagine, Coke (Coca-Cola product) is sold all over the world.
American motors is building its jeeps in Japan, Scores of Boeings Jetliners fly for various countries airlines. Peugeot is assembled in Nigeria, you may carry a sony portable radio, drive a Toyota car, wear Italian shoes here in Nigeria and any other part of the world. They are all prove or evidence of international business.
During the past three to four decades, the world has experienced the growth of an economic phenomenon the multinational corporation (MNC). Hicks and Gullet (1981), maintain that MNC are involved in the international business, through one exporting, licensing, franchising, joint venture, foreign branch or wholly owned subsidiaries.
Whole the MNC is not new, its importance, power and consequences have come to be appreciated fully only recently.
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For instances, consider the significant role that large Multinational Oil Companies are playing in the economic systems of the World in General and Nigeria in particular. To press home point, hear what a former Managing Director (MD) of NNPC L.A. Amu, said about Nigeria economy.
“The Nigeria economy can largely be described as one with a strong petroleum industry superimposed over an undeveloped industrial base”. This is a kind of testimony of the positive role of Multinational Oil Company in Nigeria Economy. For without the oil companies, there would not have been an oil or petroleum industry in the initial place.
According to Megginson, et al (1988) “MNC are more than just giant business firms, for they tend to have social, and even political effects as well as economic ones in their host countries”. KINARD (1985) could not agree with this vie, when he said that huge corporations like MNC, play not only economic roles but also important political and social roles in their environments.