In the 1960s and 1970s, Singapore was one of the very few Third World countries to welcome multinational corporations (MNCs) to set up business. The conventional wisdom at that time, as explained in a torrent of academic literature, was that MNCs represented the power and wealth of the rich nations, the First World. Their purpose in investing in Third World countries was to exploit them.

This attitude had two consequences. First, governments in Third World countries discouraged MNCs from direct investment. Next, they grouped themselves into international alliances to confront the rich countries. The most famous of these groups came into being under the auspices of the United Nations in UNCTAD (United Nations Conference on Trade and Development). The purpose of UNCTAD in time became no less than the establishment of a New International Economic Order (NIEO) in which rich countries would share their wealth with poor countries in a more just world order. NIEO did not take root.

In the meantime, Third World countries which welcomed MNC direct investment prospered. Singapore was the first country in Southeast Asia to adopt this policy in the manufacturing, financial and tourist industries. Soon, MNCs spread their operations to our neighbours, first Malaysia, then Thailand and later Indonesia. All these countries have benefited from MNC operations. There are indications that some Third World countries which previously opposed MNC direct investment are changing their minds. For example, Vietnam, once the most militarist and xenophobic country in Southeast Asia, has opened its doors to MNCs.

This study traces the operations of MNCs in Singapore, Malaysia and Thailand. The data collection in field studies was done by two officers of the Singapore Economic Development Board, Mr Tan Juay Miang and Mr Suresh Natarajan. Their write-up was reviewed and edited by Mr Patrick Daniel.