Host government control of foreign manufacturig companies: The Egyptian experience

In managing their overseas operations, multinationational enterprises Mnes are accused of carrying out policies which are primarily in their interests but which adversely affect the economic welfare of the host economy. The literature on the economic imacts of these firms upon host developing countries clearly supports such an accusation and illuminates the need for effective government control. Ahost government control model consists basically of two complementary and integrated control processes: an entry control process to ensure that only those foreign investment projeccts which will be of benefit to the national economy are approved; an operational control process to chech that aproject’s operations are carried out according to an approved pattern. Requiring local capital participation ) ownership control represents another government tool to control the activities of MNES. The ability of host governments to operate such controls is constrained by several factors. (