Global Production Network

Positive and Negative Impact of Foreign Direct investment in Mexican RetailingForeign Direct Investments (FDI ) is credited for the harvesting among emerging economies such as that of Mexico (Kumar , 2007 . Through the years , FDI from the United States , Canada and otherwise developed countries had flowed in Mexico s manufacturing and sell sector- phenomenon which are credited for the overdress in its GDP , GNP and per capita income (Espana et al , 2000 . However , contempt the positive economic numbers that can be seen in the sell sector such as the 4 and 7 .5 growth in 2005 and 2006 consecutively , critics argue that the positive extend to of FDI on the economic numbers may not be present in other externalitiesFor instance , Durand (2007 ) argued that the presence of multi solid groundal retail stores such as Wal Mart had thwarted the growth of topical anesthetic and traditional stores in Mexico . Hence , resulting to what the author termed as de-fragmentation which in turn holds down retail sector productiveness Consequently , Durand (2007 ) argued that FDI had negatively concussion the employment sector in Mexican retailing . For one , workers in the retailing industriousness are still way below the national engross average Furtherto a greater extent , industries and local products are no long-acting as popular as before as more and more imported products that are offered in transnational retail stores dominate the shelves in the retail sectorHowever , despite these critics and arguments , the positive impact of FDI in Mexico s retailing sector still outweighs its negative or backward effects .

For one , the retail sector in Mexico s economy had posed positive gains and thence , had contributed greatly to the nation s GNP This can be seen in the FDI figures in Mexico s retail sector - the annual average of US 1 ,400 meg being invested to increase retail stores and floor space has conduct to modern stores with a wide variety and array of local and international productsConsequently , the retail market alone had posted a 4 increase in sales in 2005 indicating that the retail sector had been pushed by FDI to be a major coerce in Mexican economy . age it can be argued that transnational stores such as Wal Mart had dwarfed domestic and traditional stores , it can also be viewed from the perspective that it had in truth obligate these domestic and traditional stores to improve on their management , force , productivity and service in to keep up with the contention . It should be noted that in a globalize conception there is a need for Mexican workers and companies to compete and hence the retail sector is an important sector to startSecond , while Durand (2007 ) had argued that it had not improved the wages of workers in the retail sector , FDI had actually increased the number of employed workers indicating that the retail sector had contributed in easing the very high unemployment rate in Mexico . While the wages may still be low in the sector owing to the high supply and low guide of workers , this can be a stepping...If you want to get a full essay, order it on our website: Orderessay

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