ABSTRACT
Vernon has identified the obsolescing bargain as an inherent source of friction and instability in corporate/host relations, especially in developing countries. The resource-based enterprises were especially susceptible to pressures for renegotiation because of the large scale of capital investment typically involved. Nationalization injects a political component into the determination of remuneration, sometimes through the sheer size of the labour force, as in the case of large plantation sectors, or through formidable financial muscle as in the case of capital-intensive mineral sectors. The oil windfall provided the Trinidad government with substantial resources for expansion of public ownership either through the acquisition of existing firms or the establishment of new ones. In addition to requirements to perform political favours at the expense of viability considerations, such as Guysuco’s onerous non-sugar activities, there are other less blatant political imperatives that may nevertheless be more enervating.
