Научная статья на тему 'Economic analysis for forecasting and prospective planning of economic processes of local self-government'

Economic analysis for forecasting and prospective planning of economic processes of local self-government Текст научной статьи по специальности «Социальная и экономическая география»

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DEVELOPMENT / COMMUNITY / ANALYSIS / PLANNING

Аннотация научной статьи по социальной и экономической географии, автор научной работы — Samborska O.

The process of globalization of world economy enters new conformities to law and changes the levels of responsibility for local development. Globalization of world economy results in strengthening of role of communities in economic development of local territories and country. Society realizes that development of Ukraine depends on possibility and personal interest of communities to engage in local development. Completion of processes of decentralization and reforms of self-government, practical realization of principle of ubiquity of local self-government, lays on the leaders of community's other level of responsibility for development of locality. Territorial communities must transform from the object of management on management subject and independently to ensure their ability. Territorial communities will bear responsibility for planning of the development, for the economic future and welfare. Therefore, local power must understand the features of modern development, own necessary knowledge, information, skills and experience, to provide the greater competitiveness of the communities. The current period of growth is thus characterized by a paradoxical consequence of globalization in which the ever-greater integration of national and regional economies into the global one accentuates, rather than minimizes, the significance of the local context for innovative activities. Analysts recognize that while the process of globalization poses new challenges for regions and localities, it simultaneously creates new opportunities which arise from their unique capacity to serve as centers of learning and innovation [4].

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Текст научной работы на тему «Economic analysis for forecasting and prospective planning of economic processes of local self-government»

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ECONOMIC ANALYSIS FOR FORECASTING AND PROSPECTIVE PLANNING OF ECONOMIC

PROCESSES OF LOCAL SELF-GOVERNMENT

Samborska O.

PhD, associate professor of the department of administrative management and alternative energy sources, Vinnitsa national agrarian university 3, Soniachna St., Vinnitsa., Ukraine

Abstract

The process of globalization of world economy enters new conformities to law and changes the levels of responsibility for local development. Globalization of world economy results in strengthening of role of communities in economic development of local territories and country. Society realizes that development of Ukraine depends on possibility and personal interest of communities to engage in local development. Completion of processes of decentralization and reforms of self- government, practical realization of principle of ubiquity of local self-government, lays on the leaders of community's other level of responsibility for development of locality. Territorial communities must transform from the object of management on management subject and independently to ensure their ability.

Territorial communities will bear responsibility for planning of the development, for the economic future and welfare. Therefore, local power must understand the features of modern development, own necessary knowledge, information, skills and experience, to provide the greater competitiveness of the communities.

The current period of growth is thus characterized by a paradoxical consequence of globalization in which the ever-greater integration of national and regional economies into the global one accentuates, rather than minimizes, the significance of the local context for innovative activities. Analysts recognize that while the process of globalization poses new challenges for regions and localities, it simultaneously creates new opportunities which arise from their unique capacity to serve as centers of learning and innovation [4].

Keywords: development, community, analysis, planning.

Decentralization in Ukraine can be viewed both as a tool and a goal of a public administration reform, which requires re-distribution of tasks, competences, and resources at central, regional, and local level. This means the transfer of more responsibilities, competencies, and resources from the state to the local self-government authorities, community-based organizations and affordable public services delivery. The current system in the state remains highly centralized with

some degree of political decentralization, a partial administrative decentralization (mainly at the level of villages and municipalities) and elementary aspects of financial decentralization (hardly any non-earmarked funds, limited budgetary power). Nevertheless, in current indefinite period rayon's, municipalities and villages try to make use of their limited possibilities and resources [1].

The acronym SWOT was first introduced in 1963 at Harvard at a conference on business policy by Professor Kenneth Andrews. Initially, SWOT analysis was based on the image and structuring of knowledge about the current situation and trends. In 1965, four Harvard professors - Leraned, Christensen, Andrews, Guth proposed the technology of using a SWOT model to develop a firm's behavior strategy.

SWOT an analysis is a comfortable method of arrangement, systematization and differentiation of factors and phenomena that operate into society and from outside and that characterize her state and prospect of changes. The technique of doing a SWOT analysis is to group information by criteria: strengths and weaknesses, opportunities and threats. A term SWOT is created in first a letter of English words: Strengths (S), Weaknesses (W), Opportunities (O), Threats (T).

Strengths are resources, assets or factors that are in community and give competitive edges to her they can be used for development and do this territory an attractive mestome for a residence and business. Formulating the list of strengths, it is necessary to choose those factors that is used or can be used or development of society creation of workplaces, development of business, bringing in of investments, upgrading of life and others like that. Weaknesses are actors or phenomena that create obstacles or limitations on a way to development. They can touch traditions, finances, regulator politics, physical resources, intellectual resources and others like that. Opportunities are winnings situations or terms, that is created in an environment, facilitate development of competitive edges and can assist to development of society. Threats are unfavorable tendencies of changes in an environment, that result in the decline of competitiveness and can negatively influence on development of society.

SWOT began to apply is an analysis in business with the aim of search of ways of improvement of competition positions of enterprises and organizations regardless of their size and sphere of activity. He gave an opportunity to connect important internal quality descriptions of organization (strengths and weaknesses) with the results of researches of external terms (opportunities and threats). In 70th of past century of SWOT - an analysis began to be used among physical persons for the facilitation of vital choice (for example, choice of place of studies, planning of career and others like that), after he found wide application in a public sector as a method of comprehension of priorities of development of cities, regions, for development of plans of development communities.

Strengths:

What are the advantages of the community over others?

What are the strongest positions in the community - in strategy / economy / services / sector?

That do we do (or can do) better than other?

What is good, from the point of view of the residents, for living in their community?

What does not work in the economy / policy / services / sector?

Weaknesses:

Where are we weak and what are we doing badly?

In what worse we than other?

What is most dissatisfied with the community?

What hinders development in the community the most?

That a most improvement does need?

That does not work in an economy/to politics/services/.

Opportunities:

What external changes can improve a situation?

What can change the situation in the community for the better?

What changes in technology and markets in the country or internationally can be used by the community to grow?

What tendencies will be useful to society?

What positive changes are envisaged in a region?

Threats:

What are the obstacles to community development (quality of life / business development / service delivery, etc.)?

As can international tendencies harm to development?

How a change in the country's political course will affect the community?

What can harm community development?

What changes in a region can have negative influence on communities.

At the use of SWOT often there are difficulties an analysis with attributing of factors and phenomena to one of four categories, so as understanding of essence of these categories is interpreted ambiguously. As far as it easily intuitively to understand a difference between desirable factors (Strengths and Opportunities) and undesirable factors (Weaknesses and Threats), so appropriately there are misunderstanding during verification: than Strengths different from Opportunities, then Weaknesses from Threats. It is mostly accepted to consider that strengths and weaknesses are internal factors, advantages and threats - external. Sometimes, user SWOT- the signs of today's situation are attributed to strengths and weaknesses an analysis, and possibilities and threats - to the future events. Other users' strengths and weaknesses use as factors that depend on us, opportunities and threats as objective factors on that does not have direct influence.

To effectively use SWOT analysis for the territorial community, its plans or strategy, it is recommended to consider: the strengths and weaknesses of the community are internal factors that already exist in the society and that can vary due to certain actions in the territorial community, and under the influence of changing environmental factors. Opportunities and threats to the community are external factors that already exist outside the community or may soon arise, and which virtually no individual community can influence (For example, the macroeconomic situation in the world or national budget policy in Ukraine), but which may affect development communities.

Properly executed SWOT analysis should show how to best use own resources and factors to reduce in-

ternal weaknesses, optimally utilizing external capabilities and eliminating external threats. It is an effective way to summarize the linkages between environmental impacts and the selection of strategic priorities. Basic principles of effective SWOT analysis in the community: community involvement and participation; partnership and cooperation; representativeness and objectivity.

For effective SWOT analysis it is advisable to use the method of "brainstorming". The process of SWOT analysis requires the formation of a team and the involvement of people whose task is to find answers to the strengths, weaknesses, opportunities and threats. It is important that the selection of the factors of the SWOT analysis should be made by consensus. The structure of the SWOT team should reflect the structure of the local community - the main players and community activists. Various local views and interests (deputies, academics, businessmen, youth, etc.) must be considered to ensure full representation. Of course, SWOT analysis is inherently subjective, and each person can come up with different conclusions based on their own thoughts and understanding of the situation.

In the context of territorial community development planning, SWOT analysis can be used to systematize the results of a community profile analysis; streamlining survey findings into strengths, weaknesses, opportunities, and threats; rapid analysis of the state of the territorial community; summarizing the results of all previously performed analyzes in order to work out directions for change and goals; comparative characteristics and positioning of the territorial community among other communities; identification of critical problems and factors of competitive advantage; finding

ways of community development and strategy development; developing plans and programs; initiating and further monitoring changes in community activities.

Sometimes SWOT analysis is used to brainstorm ideas at the beginning of an analysis, so it does not always act as a tool for generalizing results. Using analysis in this way can be too subjective, especially when it is the only way to investigate the situation and when the assessment is submitted by random people. In this case, the results of the SWOT analysis should be refined and further examined in a further study.

SWOT analysis belongs to the category of strategic analysis. The distinction between strategic analysis and strategic choice is sometimes artificial and quite sensitive. It is a mistake to consider SWOT analysis as an abstract or theoretical process. Such an analysis requires a serious critical reflection on existing data and facts and, of course, requires the professional experience of the experts who do the work. First, the focus should be on the objective fixation of what has been achieved, then on a critical understanding of the possibilities and threats in the future. Above all, attention should be paid to current trends that occur in the external environment, and the impact of which may be most significant. The SWOT analysis is performed both to assess the state of development of the territorial community and to assess sectors of the economy or spheres of activity (small business development, attracting investments or the state of the environment). SWOT analysis complements the community profile and survey results well. It helps provide some useful insights that will help make the plan stand out from the identified strengths and minimize impact or eliminate weaknesses, seize opportunities, and avoid or reduce threats.

Table 1

An example of a SWOT fragment is a community analysis

Strengths Weaknesses

S positive demographic dynamics; S presence of foreign investors; S availability of scientific staff and scientific development; S availability of competitive industries; S tourism and recreational potential; S national, religious and cultural traditions; S authentic crafts; S high level of self-organization of the population; S high level of development of small and medium business. S low industry diversification; S technological backwardness of industry; S low capitalization of intellectual property; S insufficient development of road and engineering infrastructure; S high labor migration; S outflow of intellectual resources; S low level of environmental awareness; S poor waste management.

Table 2

A SWOT fragment is a community analysis_

Opportunities Threats

• foreign investment in the economy; • development of renewable and alternative energy sources; • revival of export-import relations with the EU, the emergence of new markets for products; • development of infrastructure, first road and housing; • decentralization of power, incentives for local development, and increased budgetary autonomy of communities. • increased labor migration and loss of manpower; • weakening of export-import relations with the countries of the Customs Union; • lack of natural gas due to excessive dependence on imports; • reduction of domestic turnover and closure of businesses due to low purchasing power of the population; • rising prices for energy resources.

The role of internal factors is crucial in community development planning, since the achievement of goals and action plans must strengthen the strengths and address the weaknesses of the community. To facilitate the choice of internal factors, it is worth using their classification, table 3.

Table 3

Classification of typical internal factors Classification internal factors Strengths Weaknesses

1. Natural resource potential

2. Economy

3. Scientific and technical potential

4. Demographics

5. Human potential

6. Ecology and the state of the environment

7. Investment attractiveness and investment activity

8. Institutional infrastructure

9. Engineering infrastructure

10. Social infrastructure

11. Social capital (entrepreneurial spirit, cultural traditions, cooperation and trust)

12. Tourist potential

13. The level of natural and technogenic security Budget security

14. Network and effectiveness of public organizations

Openness of government and cooperation with public organizations and private bodies

Investigating external factors - opportunities and threats that affect community development or strategic goals - is not easy. External factors are multifaceted, interdependent, and concern the macro-environment that is formed at different levels (region, country, world). To systematize this variety of external factors, it is convenient to use the PEST or PESTLE method. PEST (LE) analysis aims at identifying, structuring and generalizing the environmental impact of community development. Of importance is that PEST (LE) is used to understand the future impact of external factors that may be different from those of the past. PEST analysis includes identifying political, economic, socio-cultural and technological impacts, providing a way to explore the environmental impact it has had in the past and which it may have in the future. Recently, when analyzing the impact of external factors, legal and environmental factors are increasingly distinguished from the common list of external factors (the cause is increased legal influence, often outside national political systems, such as European or international law and increased attention to environmental safety and conservation of human habitat). A growing awareness of the importance of influencing external factors has led to the PESTLE analysis replacing the traditional PEST analysis.

The term (acronym) PESTLE was created in the first letters of the English words: political - political influence;

Economic - economic impact;

Social - socio-cultural influence;

Technological - technological impact;

Legal - legal influence;

Environmental - the impact on the environment.

To take full account of all external factors, a checklist of a list of possible external influences is proposed.

Political influences: world and national tendencies of change of policy and mood, geopolitical situation, international relations, change of government and ex-

pectations of elections, change of political elites, reforms, administrative-territorial system, public administration, goals of local, regional, national development.

Economic impacts: economic growth data, GDP trends, structure, unemployment rate, cost of labor, cost of labor, changes in public and private sectors, interest rates, inflation, unemployment, profitability of spheres, globalization of the economy, macroeconomic situation, spatial and economic situation potential, economic cycles, business development cycles, change of national and regional labor distribution system.

Socio-cultural influences: information on educational attainment of different population groups, demographic changes, migration intensity, income distribution, consumer behavior, social mobility, lifestyle changes, attitudes towards work and leisure, consumer protection.

Technological influences: new discoveries and obsolescence of technologies, level of technological structure, investments in science and development, registration of new patents, development of information technologies, automation and communication, speed of information transfer, dynamics of private and state (budget) investment in scientific research.

Legal: international / European agreements / law, labor law, competition law, tax and budget law, environmental law, local development law, health and safety law, local government / local government.

Environmental impact: environmental standards and norms, energy costs, energy consumption, use of alternative energy sources, emissions into the atmosphere, transportation volumes, waste management, environmental protection.

Generally, environmental burdens depend heavily on local governance and geography, but also vary systematically with economic development. As it has been experienced in recent centuries, economic development has, with some notable exceptions, tended to shift the principal locus of the urban environmental burdens

from local to city-regional and eventually towards global scales [6].

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An example of using PEST (LE) analysis and selection of external influencers is presented in Table 4. The above influencers may be of limited value if they are considered only as a list of impacts. Therefore, understanding their implications is important. In the process of PEST (LE) analysis, attention should be paid to

the factors that lead to change and may act as forces that influence the structure of an industry, sector or market in the community. The cumulative effect of certain factors may be more important than the influence of the individual. Factors leading to the integration processes and globalization of economic or market sectors will serve as a good example.

Table 4

Using PEST (LE) analysis to consider external factors

External factors Opportunities Threats

Legal and political Export-oriented government policies will increase business opportunities. EU and NATO accession -approaching markets, opportunities for co-operation. Administrative-territorial reform is an opportunity to expand the authority on urban land management. Re-privatization policies can cause uncertainty and reduce investment. Frequent elections to state and local governments cause instability. Lack of local government approval can be a hindrance to local development.

Economy Improving the taxation conditions for small and medium-sized enterprises will improve their economic situation. Diversification of energy sources will limit the rise in energy prices. Reducing bank lending rates will help business development. Reducing inflation will improve the economic condition of enterprises. A real estate tax will ensure a stable income for the local budget. Hryvnia revaluation / devaluation will affect foreign trade and investment in Ukraine. The sharp fluctuation in the exchange rate creates uncertainty in the market. Setting world energy prices will increase the cost of production. Reducing jobs by introducing new technologies and increasing wages will exacerbate social problems.

Social and cultural Increasing income in Ukraine will lead to the development of cultural and leisure businesses. Improving quality of life will increase fertility. The return of Ukrainians from abroad will increase the number of skilled technicians. An increase in the proportion of older people is higher taxes on social security and health care. The outflow of young educated people from the city / country is a decrease in human and human resources.

Technological Rapid growth of innovative enterprises at the expense of state support for the development of IT industries. The revolution in telecommunications will help local businesses enter foreign markets. Growth of related industries for existing industrial enterprises. Accelerating technological change limits employment opportunities for unskilled workers. Increasing the likelihood of transnational companies dominating the local market in Ukraine.

After identifying the most important external trends, based on an analysis of opportunities and threats, their next step is to evaluate them in terms of the potential consequences for the current situation and the selection of the necessary community development goals. The influence of some factors may be quite significant, while others may not matter at all. It is about eliminating factors that will not affect the community and selecting those factors that are likely to affect the planning entity. The latter should be systematized by:

1. Direction of influence (positive or negative).

2. The power of influence.

3. A sign of importance for achieving the desired change.

With PEST (LE) analysis, it is possible to trace, at an early stage, trends in future geopolitics, economics, technology, fundamental values and stereotypes of society, and respond in a timely manner, using the estimated opportunities for better or defending against threatening prospects. What is a SWOT matrix? The SWOT matrix is constructed from the selected data in the SWOT analysis table. It helps to select possible strategies - important goals and action plans that can be implemented, finding the best match between strengths and weaknesses as internal factors, as well as opportunities and threats as external. Possible SWOT strategies are listed in the table 5.

Table 5

SWOT analysis strategies are possible

Strengths Weaknesses

Opportunities Comparative advantages. Community strengths are supported by opportunities and can enhance success The weaknesses of the community can be overcome using opportunities

Threats Strengths can be used to limit or eliminate the impact of threats Weaknesses must be overcome to protect against threats

An example of using a SWOT-matrix for identifying mutual impacts (strengthening or weakening) was used in the EU planning methodology that has been used by several projects in Ukraine. Here are some tips for effective SWOT analysis:

■ Be realistic about assessing strengths and weaknesses.

■ Efforts must be made to clearly distinguish between the current situation, the possible and the desired future situation.

■ Be specific in wording, avoiding ambiguity.

■ Community competitiveness comparisons should be used (in the absence of quantitative data, the words «better» or «worse than...» may be used).

■ Prepare a short and simple SWOT table that is clear and easy to use.

Ideally, SWOT analysis is performed in several stages:

1. Extracting and classifying the results of a profile analysis into four segments (strengths, weaknesses, opportunities, and threats).

2. Extracting and classifying the results of an opinion poll into four segments (strengths, weaknesses, opportunities, and threats).

3. Gathering stakeholder assessments of strengths, weaknesses, opportunities and threats (stakeholder views of strengths, weaknesses, opportunities and threats can be important not only in the light of additional data relevant to SWOT but also in strengthening a sense of responsibility for community development).

4. Summarizing the data collected and holding an open meeting to complete the SWOT analysis, selecting the most important influencers and their priorities (local development experts should be moderators of the meeting).

5. Preparation of a simple SWOT - a matrix that will be further used to make the following decisions.

Polish experts in community development planning often use A-B-C analysis instead of SWOT. They described this analysis well and substantiated its practical advantages in the book "Islands of Hope - developing local development strategies" by J. Varda and V. Klosowski. A-B-C analysis is a simple method of organizing information about the state of a territorial community. It helps from the "sea" of data that characterize a territorial community to select those elements and phenomena (factors) that we evaluate as influencing the community and are practically prerequisites for development. The name A-B-C is an abbreviation of the first letters of English words: Advantage, Barrier, Controversial.

It should be emphasized that the A-B-C analysis has high practical applicability for identifying strategic prerequisites - the choice of factors that will be used in the future to formulate strategic planning goals. Therefore, the replacement of SWOT analysis by A-B-C

analysis is appropriate, especially in terms of using it to systematize the factors affecting the community and to generate data for the choice of planning goals for a direction of development (small business development, improvement of infrastructure, attracting investments, etc.). SWOT analysis also performs this function, but it is more widely used (in the context of a community survey described in the previous paragraph) and is therefore slightly more difficult to use. A-B-C analysis can be used as a supplement to SWOT analysis. The technique of performing A-B-C analysis is like the technique of SWOT analysis. It consists of grouping what we know about the situation under analysis into three criteria. Anything that we cannot add to any of the groups is dismissed as unnecessary information. Selection of data is to break them down into three groups. Questions are asked about each of the factors analyzed.

1. Is this a community reality advantage in terms of community development? Is it because of this fact that community development will be faster and better? If so, record this fact in Group A.

2. If this factor is not an advantage, may it be a barrier to community development? Due to this fact, will development be more difficult, slower, more uncertain, or in an undesirable direction? If so, record the analyzed fact in Group B.

3. When it is difficult to identify this factor as an advantage or a barrier, but we know for sure that it will have a significant impact on future developments, it is a contentious issue. An example is the future fiscal tax - an advantage or a barrier to city development? We do not know what the response of taxpayers will be - will they be less, which will reduce budget revenues, or will they pay increased tax and revenues will increase? This fact is attributed to group C.

4. If this factor is not an advantage, a barrier, and does not fall into the category of controversial issues, it means that it is not a category of factors that should be considered when selecting strategic priorities for community development planning. (The moment of throwing away the material in the "dump" is difficult from a psychological point of view. But without it, you do not get material that can be effectively worked.) It is obvious that the individual factors (facts) of each of the three categories of A-B-C analysis do not can have the same impact on local development. Some advantages are more important than others, some barriers are easier to get around than others, some contentious issues are easier to predict, others are almost impossible. Therefore, for the A-B-C analysis to be accurate, the selected factors need to be given a numerical value that reflects their importance rating. The more important the factor, the greater its numerical value. It is convenient to use a rating scale in the range from 1 to 4 (Table 6).

Table 6

The distribution of the importance of the factors for the analysis of A-B-C _

Classification of properties of factors The weight of the factors

A factor of low importance, which is of little importance for the development of certain areas of life or parts of the territory 1

A factor of medium importance that is of average importance for the development of areas of life or parts of a territory, or has little impact on the development of the whole territory 2

An important factor that is significant (but not crucial) for the development of certain areas of life, some parts of the territory, or of medium importance for the development of the whole territory 3

A very important factor that is crucial for the development of certain areas of life, some parts of the territory, or important for the development of the whole territory 4

In addition to assessing the importance of the impact of the individual factors of each of the categories -preferences, barriers, and disputes - there is another important factor verification - time verification, which addresses only two criteria in - preferences and barriers.

The distribution of bene

Therefore, the next step in the analysis is to evaluate over time the factors of preference (A) and barrier (B). According to the variability over time, they are proposed to be classified into six groups (Table 7).

Table 7

s and barriers over time

Classification of factors Symbol Vector of change

A factor whose value is growing rapidly 1

An increasing factor

Invariable factor, the value is stable -►

A factor whose value is diminishing S

A factor whose value is shrinking rapidly 1

A factor whose variability is unknown ?

The advantage that belongs to the category of medium importance today may soon fall into the category of very important factors, or vice versa, into the category of low importance factors. For example, the poor accessibility of community communications within five years will disappear if the freeway is completed, or all efforts made to create and support the activities of the Investment Attraction Agency will be futile unless the land preparation issues for which the land preparation is resolved a strategic investor should come. Therefore, each of the factors that will be identified as a prerequisite for community development should be assessed in three stages:

1. Assigning a factor to a category of benefits, barriers, or disputes (Groups A, B, or C).

2. Assessment of the importance of each of the factors in all groups A, B, C -Refer to the level of impact on community development on an appropriate scale (using a scale from 1 to 4 is proposed).

3. Each of the factors assigned to the benefits and barriers (groups A and B) is indicated by vectors (symbols) of the dynamics of time variability according to the proposed classification.

For example, if a specific factor (prerequisite for development) is labeled "A3cp", then it should be considered as an important advantage, the value of which is growing rapidly over time.

Table 8

A fragment of the results of the A-B-C analysis_

A Benefits high likelihood of a positive conjuncture for global tourism, transit services (potential economic activity), complete gasification of the community, water reserves, radio communication available throughout the territory of all mobile operators, the activities of the Community Association, which is a good school of civic and economic activity, a rich natural resource that can be used for economics.

B Barriers school education network does not meet urgent needs, fertility is declining rapidly, negative, fast-growing migration balance, outflow of educated youth, lack of sewage network, small number of business entities, low level of public self-organization of residents, fragmentation of land use.

C Controversial issues what can be done to increase the entrepreneurial activity of the residents, what are the most important problems, whether there will be additional jobs due to the development of entrepre-neurship and tourism, or the possibility of industrial exploitation of peat deposits, sand without conflict with the tourist function of the community and the location of the community in the source area drinking water

In the results of the A-B-C analysis, as a rule, factors with values 1 and 2 are removed (exceptions are factoring whose vector is increasing by magnitude and rapidly increasing by magnitude). The results of the A-B-C analysis will allow us to discard unnecessary information and to use only important facts to formulate local development plans for the strategy.

Proposal reform on voluntary association of communities enables them to acquire the status of the capable local community, in which local sources of budget revenues, infrastructure, and human resources are enough to meet the interests of residents. The territorial community independently manages the property that is in communal ownership; establishes local taxes and fees in accordance with the law; ensures the holding of local referendums and the realization of their results; establish, reorganize, and liquidate communal enterprises, organizations, and institutions, and controls their activities; decides other issues of local importance, assigned by law to their competence [9].

Fundamental position of state support of development agrarian to the sector of economy and rural territories must be the maximal use of possibilities, that is envisaged by international obligations under the Agreement on the entry of Ukraine to World organization of trade (WTO), that envisaged limitation of direct support only on such called directions of "yellow small box" in volumes not more than 609 million $ (and it on a today's course is almost 18 milliards of hryvna), there in addition no more 5 % of gross products of agriculture on every her kind. Moreover, the requirements of WTO do not limit the volumes of state support of the so-called "green box", where charges belong on the guard of earth, maintenance of fertility of soils, support of agrarian science, plant protection, ant epizootic measures, training of human resource, social domestic arrangement of rural territories and all that [11].

References

1. Berdanova O., Vakulenko V. Strategic planning of local development. Practical Guide / Swiss-Ukrainian Decentralization Support Project in Ukraine. DESPRO. Kiev. LLC Sofia-A. 2012. p. 88.

2. Brol R. Rozwoyj lokalny - nowa logika rozwoju gospodarczego. Wroclaw. Bazekon. №785.1998. Pp 11-15.

3. Cabinet of Ministers of Ukraine (2016) "Some issues of implementation of the Concept of Reforming Local Self-Government and Territorial Organization of Power in Ukraine: Order of the Cabinet of Ministers of Ukraine dated September 22, 2016 No. 688-p". Retrieved from: http://www.kmu.gov.ua/con-trol/ru/cardnpd?docid.

4. David A. Wolfe. Social Capital and Cluster Development in Learning Regions. Centre for International Studies University of Toronto. 2001.

5. Fay M., C. Opal. 2000. Urbanization without Growth: A Not So Uncommon Phenomenon. Policy research Working Paper. Washington. November 1999. World Bank.

6. Gordon McGranahan and David Satterth-waite. Urbanisation concepts and trends. IIED Working Paper. IIED, London. Jule 2014. 28 p.

7. Henderson J.V. Cities and Development. Journal of Regional Science. First published: 03 February 2010.Valume 50. Issue 1. P. 515-540.

8. On the principles of state regional policy. Law of Ukraine dated 05.02. 2015, № 156-VIII On the voluntary association of territorial communities. Law of Ukraine dated 05.02. 2015. № 157-VIII

9. Pronko L., Kolesnik T., Samborska O. Activities of united territorial communities as a body of local government in the conditions of power decentralization in Ukraine. Baltic Journal of Economic Studies. Volume 4. No.2. 2018.C.184-190.

10. State strategy for regional development of Ukraine until 2020. Resolution of the Cabinet of Ministers of Ukraine of August 6, 2014. № 385.

11. Samborska O. Strategy of Government of Management State Land: Foreign Experience. Web of Scholar, Multidisciplinary Scientific Journal 4 (22), Vol. 3, April 2018. ICV 2016: 49.62. pp.15-19.

12. The Verkhovna Rada of Ukraine (2016) "The Law of Ukraine "On Local Self-Government in Ukraine" No. 280/97-BP, adopted on May 21, 1997, in the wording of September 22, 2016, which considered 112 amendments introduced in 1998-2016 by the Laws of the Verkhovna Rada and interpretations of the Constitutional Court. Article 1". Retrieved from: http://za-kon.rada.gov.ua/laws/show/.

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