FOREIGN INVESTMENTS 441
affect domestic companies. The MNCs may have greater economic power to with-
stand the competition, but domestic firms may not. In other words, the competition
in the market may gradually increase the dominance of MNCs, which will ultimately
go against the interests of domestic firms.
• Nationalsovereignty: The MNCs, with their superior economic power and presence in
many countries, may monopolize the markets of the host country. Because of the power
they enjoy, the MNCs may hold the host country to economic ransom. If the host coun-
try’s policies do not suit their business interests, the foreign companies may uproot
themselves and transfer their investments elsewhere. Sometimes, the government of
the host coun ...