p In this epoch of the STR, the society’s productive forces "have outgrown the limited boundaries of national and state divisions".  [69•1  Production has now reached a scale that requires global supplies 70 of raw materials and fuel and mass export of products, as a necessary condition for sustained sales.

p The United States now imports over 30 per cent of its raw materials and fuel, Western Europe over 65 per cent, and Japan about 80 per cent; the United States and Japan export nearly 10 per cent of their GNP; Canada, France, the FRG, Britain, Sweden and Italy between 20 and 25 per cent; Holland, Belgium and Denmark from 30 to 50 per cent, etc.  [70•1  As a result, external economic ties have been expanding faster than internal economic ties, to become an important and independent factor of economic growth, structural shifts and rising production efficiency.

p Capital has, quite naturally, responded to these internationalisation processes and has sought to control them in its own interests from the outset. The capitalist entrepreneur regards the borders of states as an "obstacle to be overcome", as something “ accidental”  [70•2  and, being a commodity-owner, he very soon "becomes a cosmopolitan".  [70•3 

p External business expansion in the epoch of imperialism starts with the export of commodities and develops into the export of capital, with the higher rate of profit abroad mainly acting as a magnet: in 1983, the rate of return on US foreign direct investments averaged 8.9 per cent for the developed capitalist countries, 10 per cent for the developing countries, and 6 per cent inside the United States.  [70•4  For the 10 major industrial TNCs of France, it fluctuated from 6 to 83 per cent abroad, and from 1 to 11 per cent at home.

p Still, the profit rate is no longer the sole criterion in TNC operations, and Lenin once noted that under imperialism capital was being exported "not for superprofits alone”.  [70•5  In the commercial and economic situation of the postwar years, some corporations increasingly reach the limits of potential production growth, even with diversification, within the framework of the national markets, or in view of the limited volume of these markets, or again in view of these markets’ being under a competitive status quo, and so seek to invest capital abroad. External expansion is also stimulated by the asynchronous capitalist cycle, under which economic crises in various countries do not occur at the same time, and operations abroad help to let off steam in national situations of crisis. The mounting instability and unevenness of development of the capitalist economy as a whole likewise induce business to seek additional scope for manoeuvre abroad. That is especially true of the banks, 71 which now strive to diversify the range of their clients to the utmost, taking care not to overcommit their funds to individual industries which could be hit by a structural crisis, or countries piling up a large debt.

p Present-day competition has its specific features. In terms of prices, it requires the starting of production in countries with the lowest costs, and in terms of quality, with international producer specialisation. In the raw-materials trade, the "vertically integrated" companies have the advantage of handling all the successive stages of processing and treatment with direct outlets both to the sources of raw materials and to the final consumers. In the machinery and equipment trade, the establishment of bases for the assembly, storage, marketing and servicing of machine products becomes an imperative, and this means some kind of local infrastructure even for the conventional export of these products from the home territory. The governments of many countries, especially of the LDCs, insist that foreign suppliers produce the given products on the spot, instead of importing them. The growth of protectionism often leaves the corporations no other way out except “landing” their enterprises inside the rival’s market, bypassing his protectionist barriers. Finally, imperialist integration envisages the free flow of capital.

All of these factors explain why foreign direct investments, providing the basis for TNC operations, went up from $41,6 billion in 1914 to $108 billion in 1967, and to $600 billion in 1984. The TNCs present themselves as systems of internationally dispersed producer, marketing and other enterprises run from one centre on the principle of ensuring profitability for the whole aggregate of their operations.