This report analyses the features and issues in fifteen turnkey contracts – including one model contract -- in developing countries. It is one in a series of studies relating to contractual arrangements between transnational corporations and host countries, carried out by UNCTC. In addition to identifying the basic issues to be considered by owners/purchasers, part I of the study sets forth general advantages and disadvantages of the multiple-purpose turnkey contract, and identifies the principal issues and implications in adopting this form of contractual arrangement. Part II contains an analysis of the fifteen contractual arrangements involving facilities to be constructed in countries in developing regions. A tentative draft single-purpose turnkey contract is set forth in Annex A.

This study contains case studies of selected enterprises in the monosodium glutamate industry, the ceramics industry, the automobile assembly industry and the paper industry in Thailand regarding the modes and mechanisms whereby technology is transferred to enterprises of host countries. The main issues examined in the case studies include how and to what extent domestic technological capabilities have been enhanced by means of foreign collaboration; whether technical linkages have developed between affiliates of the transnational corporations and local suppliers of inputs; whether managerial strategies involved in absorption of imported technology differ according to the type of arrangement with the TNCs; and whether there are any differences in the effectiveness of various arrangements with respect to the impact on indigenous skill formulation, product and process modification and adaptation, and other elements which are part of the process of technology acquisition. The study concludes with an evaluation of the contribution of transitional corporations to the technology development of host countries