TNCs in Nigeria

Objective: To evaluate the role of TNCs in Nigeria

Task 1: Why might TNCs move their production to other countries?

The TNC’s want to move their production to other countries this is because in the local there
can be more same competitors which their income came less

Perspectives challenge:
Who might be upset about losing their job?

The workers who is working in the factory can be upset losing their jobs this is because the
workers might need to raise the whole family for this job to get their family members have a
good life

Advantages of TNCs for a host country Disadvantages of TNCs for a host country
Bring the country more successful Money spent more

Better working conditions People quit job

Economy might be bad

Profit became higher

Challenge: These are mostly economic, but can you think of any other social or
environmental advantages or disadvantages?
 Shell – a TNC in Nigeria

Shell Oil is one of the world’s largest oil companies. Its headquarters are in the Netherlands.
Shell oil began operating in Nigeria after oil was discovered in the Niger delta in 1958.

Watch this to find out more. Make notes, what advantages does Shell say it brings to
Nigeria?

Advantages
Growth more than 50 years
shell will do everything possible to make sure that where we’re operating, we can offer
employment opportunities
They employ some 6000 people, directly, and a further 20,000 indirectly
Gives job to 90% of job in Nigeria
Supporting growth of small business

3 Keyword - Multiplier effect:

the 'snowballing' of economic activity. e.g., If new jobs are created, people who take them
have money to spend in the shops, which means that more shop workers are needed

Task 1: Copy and paste boxes A-E in the correct boxes on the multiplier effect diagram on
the next page.

A. Government spends the money

improving the infrastructure and B. Local people earn more money from
attractions to bring in more working in Shell or the local firms
manufacturing industries

C. Local people then spend more money in local

E. Taxes to the government from businesses businesses
and people goes up

D. Local firms provide Shell’s refinery with

COMPONENTS or products
 Multiplier effect diagram

A New manufacturer, such as Shell,

start refining Oil in Nigeria

Government spends the

money improving the
infrastructure and Local firms provide Shell’s
attractions to bring in more refinery with
manufacturing industries COMPONENTS or products

Taxes to the government Local people earn more

from businesses and money from working in
people goes up Shell or the local firms

Local people then spend

more money in local
businesses

*Hint – there is no one answer just choose

which order makes most sense to you!
Be ready to explain
 Challenge option 1: Can you now think of another way manufacturing could have a positive
multiplier effect?

Challenge option 2: Can you find another case study example of where some people might
argue a TNC provided multiplier effects?

Why doesn’t everyone love Shell?

Shell operations in the Niger Delta has always been controversial. Organisations ague that
Shell is not a responsible company. What do you think? Watch the video and make notes in
your book. Has Shell brought these villages any benefits?

Disadvantages
Devastated the local environment by oil spill
Live on only $1 a day
9 million oil spills in the last 50 years
Poverty increased
Toxic and flares into the air
Try to disrupt oil supplies

Task 2: Put your ideas from this lesson and last lesson to categorise the
impacts of TNCs as positive, negative or both. (Insert Textbox)

Challenge: Can you categorise these as economic, social, environmental?

Economic = Environmental Social =

Positives Negatives

The jobs in the LEDC’s are not secure. They

TNC’s often have charities to help people in could lose they’re without if company decide
the country they work in. Shell foundation to to set up somewhere cheaper.
help sustainability and biodiversity and help
local communities