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14Nodira KHASANKHONOVA
Senior Lecturer, Department of Economics, Tashkent Financial Institute
ECONOMIC SECURITY OF THE DOMESTIC MARKET DURING
GLOBALIZATION
INTRODUCTION
Globalization is one of the main results of the development of the modern world economy and is a high stage of internationalization of economic life. The interdependence of national economies is growing as a result of the development of the international division of labor, international industrial cooperation, foreign trade and other forms of international economic relations. At present, it is impossible to ensure the economic development of countries without taking into account external factors.
It is known that the growing interdependence of economies, the growing influence of foreign economic relations on national economies, the growing participation of large and small countries in international relations are the internationalization of economic activity. The internationalization of the economy has gone through a number of stages, the first of which is international economic cooperation, in which the role of foreign trade is crucial.
International economic cooperation is the regulation of international economic relations between countries, the transformation of the results of processing beyond national borders. The next stage of internationalization is related to the term "international economic integration". This period is characterized by the deepening of the international division of labor, the intensification of capital movements, the universal nature of scientific and technological progress, the openness of the national economy and the level of free trade.
The results of economic integration can be bilateral, multi-country and inter-regional. One of the main tasks of integration into associations today is to ensure their development at the regional level. The issue is usually the introduction of an interstate system of governance and the creation of a single common regional economic complex. At this stage, there are gradual changes in all aspects of the international relations system. Much of it has to do with the evolution of globalization.
REFERENCES
The study of the economic security of the internal market during globalization is fundamental for any country. Because globalization can lead to many problems with national productivity. The analysis of economic security has been studied by many scientists such as Kh.P. Abulkosimov,
N.I.Saidakhmedova [1], A.N. Klimonova, E.A. Yurina [2], A.V. Kharlamov, V.V. Vologihin.
V.V.Vologihin writes that economic security in the context of globalization can be defined as an economic category, which simultaneously has the properties of a general and specific form corresponding to the current state of the dynamic process of globalization and the conditions of local development of economic entities - the set of threats and risks is global, and their implementation always has a local and specific character [3].Kh.P. Abulkosimov, N.I.Saidakhmedova writes that Food safety proves to manage satisfying the population of the country with self-supply of basic food products independently [1].
Economic globalization manifests in the increasing linkages between foreign and domestic financial markets (through economic interdependencies, but also through herding contagion via the behavior of internationally acting investors) [4;5;6]. Thus, globalization is predicted to aggravate the impact of a recession or a financial market crash abroad on the domestic economy. The higher the degree of a country's economic integration is, the larger the effect of the world economy on the local economy will be; the strangely interlinked national economies all over the world are, the more likely economic 'domino effects' are to occur[7]. Due to the speed of the cross-national transactions in milliseconds ('high frequency trading') and the information transparency in financial and capital markets, as compared to goods markets, cross-country domino effects are more likely to be transmitted first through the financial channels before they start, with some time lag, working through the traditional international trade-in-goods-relations[8].
ANALYSIS AND RESULTS
In today's globalized world economy, "market" reforms in most countries, especially in developing countries, should not only ensure the rapid development and stability of national economies, but ultimately ensure the national economic security of each country.
As you know, the concept of security includes political security, military security, information security, industrial security, environmental security, social security, economic security and other areas. It should be noted that the security of the country is not limited to the strengthening of military capabilities, but in recent years there has been a growing awareness that security is a comprehensive activity that includes political, economic, social and other aspects. With a systematic approach to solving this problem, it should be noted that the listed areas are interrelated and complement each other [9]. However, the "primary and decisive" role among them belongs to economic security.
In the face of globalization, should borders be closed to protect local producers, or should the market be radically opened up and integrated into the global system for development to experience the shock?
Discussing the specifics of the country, it is necessary to note, first, the Uzbek market is as small as the country itself. Therefore, compared to giants such as China, India and Russia, Uzbekistan has an important nuance - it is very difficult to scale the production of anything. Second, the country is lagging behind in terms of technological development, so it is very dangerous to be closed. Because there are no competitive advantages in the country.
Let's look at a couple of examples: Canada and the US, Austria and Germany. There are 30 million people living in Canada, more than 300 million in the United States, and the difference between Austria and Germany is eight times. In each case, they have seized it, despite obstacles we can scarcely imagine. " Such an openness does not mean that the country will lose any of its identity or political independence. Third, it is important to consider whether the country has access to the sea. If not, it automatically puts him in a position where he should at least be open to his neighbors, because without them he can't go to sea - export and import operations are difficult without him.
Independent development using protectionist policies can only be supported by large players with strong domestic markets. If this is not the case in the country, protectionism is the way to go. The best strategy for countries like Uzbekistan is to establish trade cooperation with large neighbors. First, they can be supplied with natural resources. This is the simplest version of events. Then you can only export resources, products made by your manufacturers, handmade. This can be a very successful strategy because manual labor is cheaper in your country than in many other countries[10]. This makes the cost of the product cheaper. But there is an important nuance - the quality of the workforce.
There are two conditions for joining the world economic system: the first is that everything will be done gradually, the integration period will take 5-10 years, during which the local giants will somehow get used to the emergence of new players. The second point is that if a country opens up, it is very important to differentiate the sectors, to understand which of them will benefit from the arrival of strong and foreign companies. This will give you a stronger position in international agreements and less opportunity for your partners to take advantage of you. Your partnership will not be limited to the supply of labor and raw materials, but will work together.
And we will "lose" the areas that are far behind the world trends. No matter how sad it may seem, one industry has to sacrifice another to make a profit. If these two rules are followed, the country will be able to go through the adaptation process without difficulty.
But we must not forget the political element: some areas can be very competitive, it is possible to form a relatively equal alliance with Western partners, which will bring many benefits to the economy, but if this does not happen - everyone is satisfied with the current situation.
There are three main factors in the work of the country:
1. It must guarantee stability. Because it is very important for business to be able to predict the decisions of the country's leadership.
2. From the many options of cooperation formats, the government should be able to choose the most optimal agreements for the country's development with the country or companies entering the domestic market. That is, to support the manufacturer, to know his strengths and weaknesses.
3. It is important to pay close attention and provide constant support to ensure that the population has a high level of education so that a negative scenario such as the use of the country as a source of cheap labor and raw materials does not occur. Estonia is an example. Its market is small, its population is small, its raw materials are almost non-exist, but its population is very educated and therefore Estonia is very competitive globally. First of all, in the field of IT services, because there are a lot of highly qualified programmers. The reason for their emergence is the very high level of education.
CONCLUSIONS AND RECOMMENDATIONS
The state itself needs to identify key sectors that are as competitive as possible. After that, these industries should support companies, including monopolies, and provide subsidies so that they can enter the world market without fear of competition in the domestic market. Powerful companies in South Korea and Japan chose Honda, Toyota and Hyundai to do so when they opened up to the global market by actively supporting them.
When we study economic security of the domestic market during globalization, we draw the following conclusions:
- Economic security is an integral element of national security, a set of ways, means and methods to ensure the economic needs of the country. Conceptually, economic security is based on the analysis of the following factors of national security: economic, natural, social, political, scientific-technological, socio-demographic, ethnographic-economic, informational and military-political;
- The practice of developed countries shows that ensuring economic security is a guarantee of state independence and its sustainable development. This is primarily could be explained by the fact that the economy-society is an important factor in the activities of the state and the individual.
- The economic security of the country is considered to be an important qualitative aspect of the national socio-economic system and is mainly aimed
at solving the following three interrelated problems: ensuring adequate and sustainable economic growth; effective satisfaction of social consumption; protection of economic interests of the state, society and the individuals from internal and external threats at the national and international levels.
LIST OF REFERENCES:
1. Kh.P. Abulkosimov, N.I.Saidakhmedova Supplying food safety issues in Uzbekistan. European journal of economics and management, 2017. P.17
2. A.N. Klimonova, E.A. Yurina. Economic security in conditions of globalization: threats and opportunities. Social and economic phenomena and processes. T.9. №9. 2014
3. V.V.Vologihin. On the definition of economic security in the context of globalization. Business security, 2014. P.4
4. Calvo, S., and C. Reinhart 1996. Capital flows to Latin America: Is there evidence of contagion effect?, G.A. Calvo, M. Goldstein, E. Hochreiter (eds.), Private capital flows to emerging markets after the Mexican crisis, Washington, D.C., Institute for International Economics;
5. Dornbusch, R., Y.C. Park, and S. Claessens 2000. Contagion: Understanding how it spreads, World Bank Research Observer, vol. 15, 177-197;
6. Khan, S., and K.W. Park 2009. Contagion in the stock markets: The Asian financial crisis revisited, Journal of Asian Economics, vol. 20, 561-569
7. Hertz, S. 1999. Domino Effects in International Networks, Journal of Business-to-Business Marketing, vol. 5, 3-31
8. Hernández, L.F., and O.R. Valdés 2001. What drives contagion: Trade, Neighborhood, or financial links?, International Review of Financial Analysis, vol. 10, 203-218
9. Максакова Л.П. Демографическая безопасность как фактор современной стратегии развития Узбекистана // Экономика и финансы (Узбекистан), №3 р. 99-107.
10. Vakhabov A, Muminov N, Djurakhanov F, Karimov A: The accession of Uzbekistan to the world trade organization: challenges and opportunities for the food processing industry. Uzbekistan Economy. Stat Anal Rev 2006, 4: 97-102. [http://www.uzbearingpoint.com/files/3/a43.pdf]
