What Is The Radical View Of The Foreign Direct Investment?

The radical view traces its roots to Marxist political and economic theory. Radical writers argue that the multinational enterprise is an instrument of imperialist's domination. They think that the multinational companies used host countries just for their sake and they do not want to provide any benefit to the host countries. They see the multinational enterprise as a tool for exploiting host countries to the exclusive benefit their capitalist imperialist home countries.

They argue that Multinationals Enterprise extract profits from the host country and take them to their home country giving nothing of the value in the host country in exchange. They note for example that key technology is rightly controlled by the Multinational enterprise and that important jobs in the foreign subsidiaries of multinational organizations go to home country nationals rather than to citizens of the host country.


Because of this according to the radical view foreign direct investment by the multinationals of advanced capitalist's nations keeps the less developed countries of the world relatively backward and dependent on advanced capitalist nations for investments, jobs and technology. Thus according to the extreme version of this view no country should ever permit foreign corporations to undertake foreign direct investment since they can never be instruments of economic development and only of economic domination. Where multinational companies exist in a country they should be immediately nationalized. By the end of the 1980s the radical position was in retreat almost everywhere.

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