ABSTRACT: This research work focuses on the activities of multinational corporations (MNCS) in Nigeria. It looks at the stand of some Nigerian political economics who view (MNSC) as one of the defeaments of backwardness in Nigerian economy.

These economists believe that (MNCS) are exploitative. According to the first instance before the benefit and development of Nigeria, but these objective is not realized due to the exploitive tendencies and practices of the (MNCS), this is the statement of problem which guided in the process of carrying out this research, which is to what extent has shell petroleum development company, producing in Akwa Ibom State and Nigeria as a whole. This work also x-rays the objective and operations of the (MNCS). It argues that although (MNSC) have some negative tendencies; however they contribute positively in the areas of technological development and employment opportunity. 


  1. Background of the study

The activity of multinational across the world has invited a lot of debates in the global organization. Some debates view the issues that exists between the positives and negative impacts of multinational corporations or community development. Thus, we shall consider two school of thoughts the conventional school of thought says that multinational corporation is a vehicle of development.

These national corporations enhance development; that they are saboteurs of the progress of the country which they operate. The conventional school of thought believed that multinationals corporations transfer a great deal of technology of managerial and entrepreneur skill, provide many new jobs in developing countries. While the racial school of thought opposed the view and see multinationals as distributing the economy hiding technology and threaten political management, although multinational corporations are involved in organizing production in the undeveloped countries.

However, the multinational corporation posses the most creative technology and they spend huge sum on research and development but they devise a lot of ways to exploit the economy of the country they operate, they also make use of salaries repatriation of their expatriates works. Some percentages are usually allowed for the expatriates to be repatriated home. But the employers of the multinational corporation usually inflate the salaries paid to expatriates in African countries. (Todara 1977; 329).

Thus, due to the bias nature of radical scholars patterning to multinational corporations, the conventional school states that multinational corporation brings in capital and other scarce factors which improve balance of payment directly and enhance competition, strengthen local producers and break local monopolies. However, considering multinational corporation on the point of view of  the conventional school of thought; it is a good creator for the societies where they exist because it help in transfer of technology, entrepreneur skills, provides many new jobs and employment in their area of operation.

  1. Statement of Problem   

Given the fact that most of the third world oil producing countries especially in Africa where these multinational corporation operates are basically underdeveloped and developing countries like Nigeria, one would therefore wonder whether there has been any meaningful development on the part of these multinational corporations towards these countries from which they make their wealth. Since the Niger Delta is the nerve centre of Nigeria’s oil industry. Crude oil exploration is about 2 million barrels daily and accounts for over 90% of the national total export earnings (Baker, 1983; NDES 1997). Thus, it is also estimated that the economic value of gas, if fully harnessed could exceed what is generated from crude oil, as a result, various shades of multinational oil companies operate with ease.

Furthermore, shall as a multinational corporation has distinct capacity which could be put to the service and development where oil exploration and lifting takes place in the rural area. The question then arises, as to what extent has shell petroleum development company contributed to the socio-economic development of the rural area taking into consideration the vast amount of wealth the company has extracted from these areas and the several inconveniencies and environmental hazard to which their operations has exposed our rural dwellers to? Has the activities of shell petroleum development company fostered any link with infrastructural development in rural areas.

These are the issues the research seeks to address using shell petroleum Development Company as a multinational corporation operating in Akwa Ibom State.

  1. Objectives of the Study
  2. To bring to focus the extent of impact created by Multinational Corporation and rural development and also to offer useful recommendations to appropriate authority as a way forward towards the overall improvement of the company’s service so as to achieve the goals which also entails urbanization of the rural communities.
  3. To evaluate the relationship between shell petroleum development company and the impact created in the state development.
  4. To identify the impact of Multinational Corporation on community development and economic and industrial development in Akwa Ibom State if it is attributed in any way to shell petroleum Development Company.
  5. To suggest measures which host communities can gain more from the activities of multinational corporations.
  1. Research Question  
  • What is the significant relationship between shell petroleum development company and socio-economic development of rural areas in Akwa Ibom State?
  • To what extent has shell petroleum development company contributed to the socio-economic development of the rural areas taking into consideration the vast amount of wealth it has extracted from them?
  • Does the activities of shell petroleum development company foster link with infrastructural development in the rural areas

These are the issues the research seeks to address using shell petroleum development company as a multinational corporation operating in Akwa Ibom State.

  1. Significance of the Study

This study will lead to a better understanding of the Government and people living in rural communities in Akwa Ibom State, especially where they carry out their operations, the impact and contribution of multinational corporation to development. However, it will also be a useful guide to other researchers, public policy makes students who may be interested on further research undertakings in this regard and also to other third world countries especially in Africa were the concept of development have remained a cornerstone to their socio-economic policy.

  1. Scope and Limitations of the Study

Although this project concerns multinational corporations in Akwa Ibom State, it focuses on shell petroleum development company alone. Being an examination material at the National Diploma level, its volume does not allow for extensive coverage. Moreso, the very limited time allowed, financial constraints, etc have combined to further restrict the coverage of this project.

  1. Research Hypothesis

The following hypothesis are tested in a null form:

H1:     The activities of multination corporations tends to have a positive impact in host communities in Akwa Ibom State.   

  1. Definition of Terms

For the purpose of understanding, it is necessary to give exact definitions of the major concepts and terms that would be applied in this work.

  • Development: The systematic use of technical and scientific knowledge to grow gradually to become more advanced and stronger. It is a new event or change that is likely to affect what happens in the continuing situation.
  • Flow Station: These are situations or place that will are being drilled
  • Multinational: a company operating in several countries.
  • Onshore/Offshore: It refers to the operations off the shores or land.
  • Terminals: as it is used refers to the station where oil is being exported outside the country.
  • Corporation: a company or group of people authorized to act as a single entity and recognized by the law.