Located mainly in areas of low population density, where fertile land is available for exploitation, the estates of TNCs usually devote a relatively small proportion of their total area to the major commercial crop. However, this can still be several thousand hectares. Yet the estates often occupy a small amount of the total agricultural area of a country. Good Argument Research Paper Topics given by trained paper writers Because of their relative isolation, estate managers are often forced to import labour from considerable distances and develop their own roads, services and supply and marketing systems. Overhead costs are thus higher than on traditional peasant smallholdings, but government support is often forthcoming because of the perceived benefits for local development. Greatest success is achieved where high standards of quality are paid a premium (as in rubber) and where central control and labour specialization create substantial scale economies.The output from the estates is not for local consumption but instead is destined for Western export markets. Estates, therefore, are a main export earner; this, together with imported technology and assumed benefits for local economic development, are often enough to secure government support. National governments in developing countries have seen the commercialization of agriculture as an answer to the challenge of poverty and a rapidly expanding population.However, the transnational corporations (sometimes referred to as agribusinesses) are benefiting most from the internationalization of food production and they remain a growing phenomenon in the rural economy of developing countries. Such corporations reduce their political risk by spreading operations among a number of countries: investment can be decreased in one country and increased in another; capital and technology can be made highly mobile. Good College Essays writing? Great hints on writing homework by writers! For example, the recent increase in pineapple production in Thailand can be attributed to a relocation of investment from Hawaii by one major agribusiness corporation in the 1970s. Economic risk can also be spread by diversifying corporate interests into new, higher value-added products such as winter vegetables, strawberries, peppers, melons and cut flowers.Transnational agribusinesses often have a higher financial turnover compared with the total agriculture of the countries within which they operate. While many have been nationalized, others are able to exert increasing control over agriculture in developing countries through supplying inputs (e.g. seeds, fertilizer, equipment), directing farming practices under the terms of production contracts, providing the marketing infrastructure and processing agricultural produce. For example, transnational agribusinesses and their affiliates control a large proportion of the heavily concentrated industries producing tractors, harvesters, agrichemicals and seeds. Again, between 60 and 90 per cent of the world’s trade in eight leading primary food products—wheat, sugar, coffee, corn, rice, cocoa, tea and bananas—is controlled by up to fifteen transnational agribusinesses in each sector, with just three corporations accounting for the bulk of the market in most cases. Custom Essay Help performed by responsible essay writers today! Professional services! Thus transnational agribusinesses have successfully linked the regional economies and crop sectors of developing countries with global systems of food production and consumption. Their power cannot be overestimated.
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