In which country are the largest TNCs in the world?

Trade originated in ancient times. With the development of mankind, practically nothing has changed, except, of course, the very market of goods and services. If earlier the production was based on a certain territory, now the redemption of land from other countries for the construction of their own factories and factories is quite an ordinary phenomenon. This is done (and quite actively) not only by European countries, but also by the Russian Federation. Actually, what country the largest TNCs of the world are in, and will be discussed.

What is a transnational corporation?

TNC is initially a company with production offices in several countries. The role of such corporations in the process of globalization is undoubtedly enormous. TNCs can act not only as production companies, but also as telecommunications, insurance and audit. In addition, it can include transnational banks and pension funds.

The budget, which some of the world's largest MNCs have, is so large that it exceeds the financial state of some countries. For example, the net annual profit of the corporation General Electric is just over $ 13 billion, which is almost 34 times more than the annual budget of Andorra with a population of 85.4 thousand people or slightly less than Iceland's GDP for 2015. Also, corporations play a big role in science, TNCs account for about 80% of the financial supply of R & D and about the same number of registered patents.

Transnational corporations: why internationality?

The emergence of transnational corporations, firstly, is built on the possibility of obtaining superprofits. This explains the creation of international production. Due to the presence of factories and plants in the territory of another country can significantly save:

• On the value of natural resources (if the country to which the transnational corporation belongs is not sufficiently provided with a certain type of raw materials, the construction of a subsidiary company in a foreign territory can solve this problem);
• In the tax sphere (because of differences in the economic plan, it is sometimes cheaper to conduct production as if "not at home");
• On the wages of workers (if, for example, the Germans and Americans estimate their work quite high, then the same Mexican people agree to work for a relatively small remuneration).

There are plenty of grounds for the internationality of corporations. It is on these principles that the largest TNCs of the world are held.

Types of transnational corporations

There are three types of TNCs: an international, multinational and global company.

The first type is a corporation that creates its branches in other countries, but these structural elements are separated. That is, they have their own production and scientific development. Nevertheless, the absolute priority is enjoyed by the parent company.

The second type acts as a link between national companies around the world. Actually, this view more explains what TNCs are. Each company that is part of the MNC has independence in conducting any operations.

The third species is presented as a characteristic of the largest TNCs in the world. When following this option, the corporation either provides a patented project for production jointly with other countries, or produces the elements of the product, and the assembly is already being handled by other factories. Since the 80's this species is prosperous. The largest TNCs of the world still follow this order.

The mechanism of management of TNCs

The main trends in corporate governance are the two opposite options: centralization and decentralization.

The first option is the desire of TNCs to create a single guiding center. He must be in the country to which the corporation belongs. Other branches operate only with the permission of the parent company.

The second option allows you to make independent decisions. Leading centers are established in each branch. Subsidiaries, as a rule, are sufficiently independent from other departments of the corporation.

Sources of effective activity of transnational corporations

Comparative characteristics of the largest TNCs of the world, the practical benefits of which are indisputable, suggests the following: the use of raw materials of other countries, as well as its financial capabilities, allows expanding, capturing or retaining the market. In addition, effective activity is due to the proximity of foreign consumers. Awareness of the conduct of scientific research trials, as well as their results, very well influences the development of transnational corporations.

In addition to these principles, the comparative characteristics of the world's largest multinationals make it clear that activities in several countries simultaneously help to strengthen competitiveness and improve relations with partner countries.

Statistics on the value of foreign assets

The main areas of activity of the current corporations are electronics, automotive, oil production and refining. The largest TNCs in the world often invest in non-core assets in order to be sustainable in the global market. In the list of foreign assets, the first places are allocated to the following corporations:

• "General Electric". The country is the USA, the kind of activity is electronics. The share of foreign assets is 30%.
• Royal Dutch Shell. Country - Netherlands - United Kingdom, occupation - oil industry. The share of foreign assets is 66%.
• "Ford." Country - the United States, the type of activity - automotive. The share of foreign assets is 30%.

In addition to the listed companies, there are a lot of TNCs using this development method to achieve sustainability.

List of corporations

An important indicator of the company's success in the international market is the amount of sales sold on the territory of other countries. The largest TNCs of the world, the list of which is presented below, was analyzed precisely on this principle. Also, in addition to the type of activity and the country-owner, the points include the proceeds of corporations:

1. Walmart (retail sector, USA) - 482,130.
2. State Grid Corporation of China (electric power industry, China) - 329,601.
3. China National Petroleum (oil and gas sector, China) - 299,271.
4. Sinopec Groupe (petrochemical industry, China) - 294,344.
5. Royal Dutch Shell (oil and gas sector, Netherlands - Great Britain) - 272,156.

Not all TNCs are listed here. But as of 2016, these companies are the top five.

TNCs in Russia

Since the end of the XIX century, Russia has tried to engage in the activities of transnational corporations in the world. But constant inhibition due to revolutions and political rearrangements did not allow to conduct this process fully. It is for this reason that until this time in the country services and products of foreign companies prevail. Only relatively recently, Russia started creating its own financial and industrial groups (FIGs), which are very similar to TNK.

Comparative characteristics of the largest TNCs of the world only in the late XX century, replenished Russian representative, namely: in 1996, the rating published by the Financial Times, presented the company Gazprom.

At the moment, the development of Russian corporations is slower than that of other countries. For a more successful promotion on the world market of Russia, it is necessary to unite efforts to improve its own FIGs jointly with friendly states.