infonet-economy

A variety of studies assess the impact of multinational enterprises (MNE) in developing countries. They mainly focus on the negative externalities of these companies. Therefore, this study focuses on the positive effects emanating from the presence of MNEs in developing countries. It is hypothesised that positive externalities resulting from MNEs have their source in the local embeddedness of the firm. The two case studies presented in this paper assess the embeddedness of Syngenta’s subsidiaries in Kenya and Colombia. The focus is on Syngenta’s potato production and related crop protection business. The study investigates the perspective of the company, the view of experts and the potential impact on smallholder farmers. The results show that in both countries Syngenta is collaborating with universities and other research institutions, governmental institutions, NGOs and the local private sector. Syngenta creates attractive skilled jobs for locals in both countries. The company positively influences its business partners in the area of standards and good business practices. Furthermore, farmers profit from the technologies and trainings provided by the firm or its partners. It can be concluded that through embeddedness, Syngenta understands the needs of farmers and can help to meet these needs, which in turn results in a business case for the company.