Question

One of the problems with finding new fossil fuel deposits in developing countries is that ________.
a. it is very expensive to transport the deposit elsewhere
b. those countries tend to keep the resource for themselves, not sharing with other countries
c. international companies move in to harvest the new deposit, and very little money or resource remains in the country
d. their governments seldom allow extraction of the deposit without meeting expensive environmental regulations

Answer 1

C.

Multinationals are often known for their extraction of natural resources, and when they swoop in to harvest this new deposit of resources, what ends up happening is they indeed earn a profit, but due to repatriation of profits, the money may be sent back to the country of origin and the multinational may pressure the government to not tax the multinational.