ABSTRACT
It is beyond dispute that transnational corporations (TNCs) are now the leading vehicles of economic globalization. Their cross-border financial flows of foreign direct investment (FDI) – comprising equity acquisitions, intra-company loans and reinvested earnings – are more important than global trade in realizing economic value. According to the United Nations Conference on Trade and Development (UNCTAD), in 2002 global sales of TNCs reached $18 trillion, compared with $8 trillion for world exports. While the start of the twenty-first century has seen the fourth major downturn in FDI since 1970 (down almost a third during 2001–02), in line with weak global economic growth, the stock of FDI is at unprecedented historical levels: the 2002 value of $7.1 trillion represented more than a tenfold increase since 1980. This stock – two-thirds of which is controlled by developed-world corporations (dominated by European, US and Japanese firms) – structures transnational production networks and investment chains affecting the livelihoods and living conditions of millions of people. In an immediate way, over 53 million people in 2002 were employed overseas by 64,000 TNCs through 870,000 foreign affiliates: the world's top 100 TNCs alone, with total assets approaching $6 trillion, employed 6.9 million foreign employees (UNCTAD, 2003: ppxvi, 5). More widely, the social and ecological effects of TNC activity impact beyond the working lives of their employees, encompassing contractors, communities and ecosystems.
