MACROECONOMIC INSTABILITY AND THE STRATEGIES OF THE TRANSNATIONAL CORPORATIONS IN BRAZIL: STANDSTILL, RETRENCHMENT OR DIVESTMENT?

Abstract

In the last decade, macroeconomic instability has had significant impact on TNCs performance and strategic behavior in Brazil By and large, TNCs have been able to change their trade, financial, investment and technological strategical strategies to deal with the economic crisis. The available evidence suggests that TNCs seem to have adopted a "standstill strategy" with respect to Brazil all over the last decade. This defensive strategy seems to have evolved to a "retrenchment strategy" in the last few years. Macroeconomic stabilization policies (especially, monetary polices) and the permissiveness of the Brazilian market have been the key determinants of TNCs' strategies.