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THE IMPACT OF EUROPEAN INTEGRATION PROCESSES ON THE DEVELOPMENT OF RURAL
AREAS OF UKRAINE
Baldynyuk V.
Associate Professor of Administrative Management and alternative energy sources
Tomashuk I. Assistant Professor of Economics, Vinnytsia National Agrarian University, Vinnytsia, Ukraine
Abstract
The article states that the modern global economic space promotes integration between countries in both economic and political terms, strengthening trade ties, cooperation and cooperation between countries. Sustainable economic development is an objective necessity for the further development of production relations in the world. It was emphasized the deepening of trade relations between Ukraine and the EU on the basis of the Free Trade Agreement. It is emphasized that one of the reasons for the crisis in rural areas of Ukraine is the monofunctional nature of rural development, the basis of which is agriculture. Important areas of the Rural Development Policy in Ukraine are the need for state support for the formation, accumulation and use of human capital in rural areas. It is proposed to develop a set of regional programs for the development of rural areas of Ukraine.
Keywords: globalization, integration, restructuring, decentralization, advisory, innovations.
Introduction. One of the important tasks of Ukraine's national policy is the transition to sustainable development. The state can implement this task through the rational and efficient use of the resource potential of agricultural enterprises; production restructuring; use of labor potential, which is formed in order to create the most favorable conditions for preserving the resource potential of enterprises and the country as a whole [15].
The current state of rural areas of Ukraine is characterized not only by significant structural, functional and related demographic problems, but also has significant potential for the development of agricultural and other types of business activities in rural areas.
Literature Review. Problems of rural development have long been studied by Ukrainian economists, including Kaletnik G.M., Honcharuk I.V., Mazur K.V., Vazhinsky F.A., Hungarian N.S., Gilka M.D., Koval-chuk S.Y., Chekanskaya L.A., Yatsenko O.M., Nev-zglyad N.G., Nevzglyad. A.G. and other. Their works reflect the thorough results of research on the principles of multifunctional development of the village, rural areas and rural space; principles of socio-economic management of rural development; strategic aspects of the development of socio-spatial agricultural systems, as well as analyzes the experience of rural development in foreign countries. However, the decline of rural areas of Ukraine and a number of closely related demographic and social problems require further research on
various aspects of this issue in the context of the need to implement the concept of harmonious development and enhance the role of the state.
Methodology. The problematic of the development of the potential of rural territories is based on the use of multifaceted scientific methods of knowledge of phenomena and processes. Application of statistical methodology in the process of analyzing the dynamics and tendencies of rural development, the effective functioning of agriculture, which is the basis for the study of problems of rural development in general. Economic and statistical research is based on specific techniques, their totality forms the methodology of statistics (methods of mass observations, groupings, generalizations, time series, index method, etc.).
Case Studies. The development of integration at the European level is a modern sign of progressive changes in agriculture and a relatively new area of research in Ukrainian agricultural science. European guidelines provide the agricultural sector with the appropriate vector of development and open new opportunities for the revival of agriculture, create additional comparative advantages in the agri-food market in the context of economic globalization. A serious step in terms of deepening trade relations between Ukraine and the EU should be the Free Trade Agreement, which will bring the domestic agricultural sector closer to European standards, adapt it to the EU Common Agrarian Policy and expand the presence of new EU member
states in the Ukrainian agri-food market [11; 20]. European rural development policy has evolved as part of the development of the Common Agricultural Policy, from policies addressing the structural problems of the
agricultural sector, to policies focused on the multi-functionality of agriculture and, in particular, the challenges facing rural development [5; 17]. In fig. 1 presents the main objectives of the Common Agricultural Policy.
Figure 1 - The main objectives of the Common Agricultural Policy Source: [17]
Source: [6]
Figure 2 - Causes of the crisis in rural areas
At the same time, the current EU Common Agricultural Policy (2014-2020) has different features and characteristics compared to the previous period (2008-2013) (Fig. 3).
♦Transition from support for the production of certain types of products to direct support for agricultural producers, aimed at creating a competitive environment in agricultural
production, as well as strengthening environmental
safety by abandoning the monoculture of management, which is stimulated by production subsidies;
♦Allocation of targeted subsidies for the development of depressed areas to maintain the viability of regions that are characterized by less favorable economic and social conditions
for the development of agricultural production, or limit it in favor of environmental protection;
N
♦Expanding programs to support rural development, diversify incomes in rural areas through cooperation, improve the quality of agricultural products and their marketing, compliance
with basic standards of environmental protection and animal husbandry, training in new technologies, assistance to young farmers;
♦Continuation of the policy of "cross-responsibility", which introduces the dependence of the payment of subsidies on compliance with basic environmental requirements for the condition of agricultural land, hygiene and animal care;
♦Transition to the policy of «horizontal modulation», which provides for an increase in the budget for rural development and the > expansion of environmentally friendly activities through the redistribution of direct payments;
♦Ecologically expedient afforestation and conservation of agricultural lands, alluvium of agricultural lands; reservation of rural landscapes, landscapes, greenery, wetlands, ditches, plantations, flora and fauna.
Figure 3 - The main characteristics of the modern Common Agricultural Policy of the EU Source: [3; 11]
The achievement of the set goals was ensured by defining the basic principles of functioning of the Common Agrarian Policy: free movement of goods within the EU and common prices for the same goods; common advantages, which provided for the prioritization of goods produced in the domestic market over imported products; joint financial responsibility for market and price policy of the EU [17; 21]. There
Programs (RDPs) in the Member States of the European Union, as well as 20 separate national programs. 8 EU member states want to have two or more (regional) Rural Development Programs [16]. Such indicators reflect the importance of rural development for EU member states. In fig. 4 presents a number of key features of sustainable development of agricultural enterprises.
are currently 118 different Rural Development
Establishing a possible optimal balance between the resources consumed and the resources produced;
Ensuring the best social protection for agricultural workers;
Use of resource technologies that provide the least harmful impact of economic activity on the natural environment.
Figure 4 - The main features of sustainable development of agricultural enterprises
Sustainable development of an agricultural enterprise is a way of its functioning, which is focused on achieving interaction between resources, technology, ecological and social environment.
Scientists of the Institute of Agrarian Economics in Ukraine have developed Strategic Directions for Sustainable Rural Development for the period up to 2030 (Table 1).
Table 1
Strategic directions of sustainable development of rural areas for the period up to 2030
№ Directions
1 Improving the management of sustainable rural development
2 Formation of an optimal rural settlement network and improvement of population reproducibility
3 Social protection of the rural population
4 Improving living conditions
5 Development of transport infrastructure
6 Availability of general education in rural areas
7 Providing rural residents with quality medical care
8 Ensuring employment and raising the living standards of the rural population
9 Diversification of the rural economy
10 Development of entrepreneurship and small forms of management in the countryside
11 Development of rural tourism and recreation in the countryside
12 Development of agricultural service cooperation
13 Rational use of natural resource potential of rural areas
14 Man-caused and ecological safety of rural areas
15 Financial support for sustainable development of rural areas
16 Logistics of sustainable development of rural areas
17 Investment support for sustainable development of rural areas
18 Innovative provision of sustainable development of rural areas
19 Development of agricultural information and consulting activities
Source: [13]
The basis of the Strategic Directions is a systematic and fundamental approach. An important factor in the successful implementation of the Strategic Directions is the formation of monitoring of sustainable development of rural areas and the introduction into
management of effective mechanisms for forecasting, goal setting and control at different levels of development management [4; 13]. In fig. 5 presents the main components of rural development in the context of the Strategy «Europe 2020».
Smart development
1. Support for innovation and skills, green technologies and research implementation. 2. Stimulating the development of social innovations.
Rural development
Sustainability
O
Comprehensive development
1. Local capacity development, diversification of the rural economy and development of local markets and jobs.
2. Research of alternative possibilities of agricultural restructuring.
1. Improving the efficiency of resource use to maintain basic levels of food, feed and renewable energy production and the provision of environmental public goods. 2. Reducing emissions, increasing carbon sequestration and developing bioenergy. 3. Ensuring sustainable land management and combating biodiversity loss.
Figure 5 - Rural development in the context of the Europe 2020 Strategy
Source: [17]
An important role in the development of the country and the realization of its potential is played by the foreign economic vector, features of foreign policy, international trade partners and the activity of interaction with them. The modern global economic space promotes integration between countries in both economic and political sense, strengthening trade ties, cooperation and cooperation between countries [2; 17]. Those countries that are left out of these processes
cannot remain competitive in the long run, especially in the case of untapped domestic economic potential or inefficient use.
Economic integration with a union of countries such as the European Union has a much greater positive potential than a negative one. The economy of the EU, in its vast majority, operates on a competitive basis, the desire of enterprises to maximize competitiveness, leadership based on quality. This approach has become
possible due to many years of market economy development, market saturation, evolutionary selection of the best of the best companies and realization of the economic potential of their countries. The benefits of European integration are primarily in the leveling of modern administrative barriers between countries that stand in the way of intensifying economic cooperation, flow of goods, services, capital, labor, etc. [3; 17].
This does not mean that these barriers block these flows completely, but they significantly complicate
them and reduce their volumes, which could potentially be much higher.
Ukraine has significant development potential and this applies to rural areas. At the same time, the presence of considerable problems in many spheres of life does not allow its full-fledged, and even high enough use. In the table 2 shows the main obstacles to the development of rural areas of Ukraine, building and realizing their potential.
Table 2
The main obstacles to the development of rural areas of Ukraine
See Characteristic
I Historical As a result, the structure of economic activities in rural areas is mainly agricultural, and its implementation is characterized by low efficiency and lack of organization;
II Natural Cause low population density of rural areas, high construction costs and low economic efficiency of infrastructure facilities, obstacles due to landscape and land features of rural areas;
III Economic Cause unsatisfactory level of development of market infrastructure of agriculture, low and often even negative level of profitability of agricultural production, the presence of an excessive number of intermediaries between producers and final consumers of agricultural products, rapid growth of feed prices, etc .;
IV Social They are reflected in the constant reduction of the rural population, especially in working age, the active migration of the rural population both in the city and abroad, the increase in the number of diseases and the reduction in the average life expectancy of the rural population;
V Infrastructural Manifested due to the low level of provision of rural areas with objects of production (transport, energy, communication) and social (medical, educational, cultural) infrastructure, lack of available information on alternative non-agricultural economic activities and methods of improving agricultural efficiency, underdeveloped advisory system in agro-industrial complexes;
VI Management They consist of an inefficient development management system in the country as a whole and in rural areas in particular, high levels of corruption and misuse of budgetary and extrabudgetary funds, illegal pressure on businesses, excessive complexity and confusion of the control system, which is declaratively designed to ensure high quality. products and life of the population, but in fact is a way to obtain informal income by civil servants and use available resources for their own benefit and those close to them;
VII Mental Unwillingness of the majority of the rural population to take an active part in the development of their territories and misunderstanding of their personal role, dominance of the idea of the futility of any reforms, lack of understanding of the need for quality work, increase their efficiency, use of principles of responsibility, integrity, honesty.
Source: [1; 17]
The modern development of rural areas of Ukraine takes place in the conditions of aggravation of a significant number of problems in various spheres of life.
As a result, the importance of measures aimed at improving the socio-economic condition of the native village is growing every year.
A special role in this context is given to the policy of European integration of Ukraine and its approximation to EU standards on indicators of rural development [17; 20].
In the table 3 presents the main components of the rural development program according to the Cork Declaration. From the point of view of European integration prospects of Ukrainian rural development, it is also expedient to consider the functioning of the institutional trap of «virtualization of European integration efforts», which originates in a self-coordinating mechanism of interaction between government institutions, political parties, business and society plane of virtual European integration activity.
Table 3
Rural Development Programs under the Cork Declaration, 1996_
№ Name Program features
I Priority of rural development Sustainable rural development must be a priority on the European Union's agenda and become a fundamental principle underlying rural development policy in the near future and after enlargement. The goal of sustainable rural development is to reduce the rural outflow of the population, fight poverty, stimulate employment and ensure equal opportunities and meet the growing needs for better, healthier, safer personal development, leisure, and improving rural well-being. The growing share of available resources should be used to promote rural development and ensure environmental protection.
II An integrated approach Rural development policy must be interdisciplinary in nature, cross-sectoral in application and with a clear territorial dimension. It should be implemented in all rural areas of the EU, adhering to the principle of concentration through differentiation of co-financing for those areas that need it most.
III Diversification Support for the diversification of economic and social activities should be aimed at creating a basis for independent private and community initiatives, in general: investment, technical assistance, business services, adequate infrastructure, education, training, integration of information technology, strengthening the role of small towns in the quality of an integral part of rural areas and key factors in their development, as well as promoting the development of viable rural communities and rural regeneration.
IV Sustaina bility Policies must promote rural development by maintaining the quality and comfort of Europe's rural landscapes (natural resources, biodiversity and cultural identity) so that their use by today's generations does not harm future generations.
V Subsidiarity Given the diversity of the EU's rural areas, rural development policy must comply with the principle of subsidiarity. It should be as decentralized as possible and based on the principles of partnership and cooperation between all levels (local, regional, national and European). The emphasis should be on bottom-up participation: an approach that uses the creativity and solidarity of rural communities.
VI Simplification Rural development policy, especially with regard to its agricultural component, needs to be radically simplified. There must be greater coherence in the current state of all financial support channels, restrictions on European law on general rules and procedures, greater subsidiarity in the decision-making process, decentralization of policy implementation and greater flexibility in general.
VII Programm ing The implementation of rural development programs should be accompanied by a consistent and transparent procedure. They should be integrated into a single rural development program for each region, as well as implemented through the use of a single mechanism to ensure sustainable rural development.
VIII Financing Encouraging the involvement of local financial resources will facilitate the implementation of local rural development projects. Greater emphasis should be placed on using different types of rural lending to ensure greater synergies between public and private funds, ensure access to resources for small and medium-sized enterprises, promote productive investment and diversify the rural economy. Expanding the participation of the banking sector (public and private institutions) and other financial intermediaries.
IX Management Increase the administrative capacity and efficiency of regional and local authorities and rural communities by providing technical assistance, training, improving communication, cooperation and exchange of research, information and exchange of experience through interaction between regions and between rural communities across Europe.
X Evaluation and research Monitoring and evaluation should be strengthened to ensure transparency of procedures, efficient use of public funds, and stimulation of research and innovation. Program participants should not only consult in development and implementation, but also participate in monitoring and evaluation.
Source: [18]
That is, real European integration, in which the vast majority of Ukrainian society, in particular rural residents, is clearly interested, is hampered by «institutional imitation» by certain lobby groups, including those represented in public authorities that seek to maintain their influence through quasi-
effective political institutions, blocking the implementation of EU institutional norms in Ukraine [2; 17], as it threatens their very existence and activities in the usual format today.
This situation hinders the implementation of the European integration course of our state, prevents
effective and multifunctional development of its rural Prospects for the development of the Ukrainian
areas by reducing administrative barriers and countryside and ensuring the balance of their economy
corruption, improving the quality of information and significantly depend on state regulation [2].
analytical support of the rural economy, the Information on the main orthogonal institutions that
development of civil society institutions [17]. The negatively affect the functioning of the economy of
existence of institutional traps is closely related to the rural areas of Ukraine in the context of the priorities of
problem of the spread of orthogonal institutions in the European integration of our country is presented in Fig.
Source: [17]
Figure 6 - Basic orthogonal institutions
In fig. 7 shows the main reasons for the existence of institutional vacuums at the present stage of European integration of Ukraine in the context of the functioning of the economy of rural areas of our state.
A significant mental and psychological barrier that prevents the establishment of the modernization paradigm of rural development in Ukraine in terms of European integration, is the despair of peasants in the possibility of change in their own state [17].
Apart from European principles, other effective measures should become important directions of the Rural Development Policy in Ukraine. We share the opinion of Kaletnik G.M. [10], which determines the need for state support for the formation, accumulation and use of human capital in the village. The concept of human development as one of the main components of rural development policy should become an obvious
management document in this situation. In terms of content, this concept should contain specific tasks related to the preservation of existing human capital, improving its structure, regulatory and legal support for human capital development, institutional support for rural development [11; 12].
No less important from the point of view of ensuring sustainable development of rural areas is the implementation of training programs on the formation of alternative economic activities in rural areas. To do this, it is necessary to more actively involve higher education institutions, consulting companies and advisory services in the training of specialists in services, tourism, cross-border cooperation, management and marketing, working in rural areas, creating innovative industries, enterprises with foreign capital, etc. [18; 20].
II ^ Lack of an extensive network of consulting institutions capable of providing domestic agribusiness with quality information, marketing, legal and management support in its activities both in domestic and foreign markets;
I ^ Weakness of banking and insufficient development of non-bank financial institutions (private investment and pension funds, trust companies, insurance companies, credit unions, etc.), able to accumulate and generate sufficient financial and investment resources; ;
III ^ Atrophy of the transport communications system and transport infrastructure of the domestic village, which makes it impossible to quickly and efficiently connect domestic agricultural producers with markets both within Ukraine and abroad, thereby significantly reducing the efficiency of communication networks as an important factor in increasing investment
The main reasons for the ex- !/ istence of institutional vacuums —►
V^ Deficit of civil society institutions, which results in a low level of involvement of rural residents in local government and self-government institutions, as well as the weakening of public control over the activities of public authorities and agricultural holdings; \
IV ^ The functional inconsistency of the institution of local self-government in Ukraine, especially in rural areas, with the role assigned to this institution in developed EU countries, is related to the inability of communities to solve problems of housing and communal services and social infrastructure of the native village. levels of effective economic institutions and promising forms of interaction with European partners.
Figure 7 - The main reasons for the existence of institutional vacuums
Source: [ 17; 21]
In fig. 8 presents the main tasks of the algorithm of sustainable development of rural areas of Ukraine.
□ Formation of a patriotic, creative, strong in innovative activity of the village personality, a person who will be able to give new, modern, based on traditional values of ideas, intelligence, education in the spirit of Ukrainianness;
□ Improving the activities of cultural, spiritual, educational, educational institutions of rural communities, based on common interests, attracting more people to work together in the field of sustainable development of rural areas;
I
□ Restoration and promotion of ancestral estates in the countryside, education of love for the land as a source of society, especially in Ukraine, which has long been called the «breadbasket of Europe», love of work and agriculture, which will allow in the future to lead to the reverse urbanization process - partial suburbanization;
□ Creation of an Internet portal for coordination of sustainable development in rural
communities, introduction of innovative technological developments in the village without compromising its harmonious and sustainable development, which will be able to maintain a constant relationship between rural and urban communities for sustainable development of Ukrainian society;
□ Formation of a strong elite of physicians in the framework of preserving the health of the nation, support and financing of health care in rural areas, aimed at improving physical and mental health, which should increase the sustainable life of the rural population, its durability.
Figure 8 - Tasks of the algorithm of sustainable development of rural areas of Ukraine
Source: [17]
Every inhabitant of a village or city has the right to modern medicine and education, accessible and high-quality administrative, communal, social services, good roads, clean and lighted streets. But people can only influence the quality of these services when those responsible for providing them are close. The closest authorities to the people are local governments: village, settlement city councils and their executive committees [4; 10]. Therefore, they must have broad powers and sufficient resources to be able to address all local issues and be responsible for them. In the table 4 provides information on the formation of OTG in Ukraine.
To this end, Ukraine is in the process of decentralization - the transfer of powers and finances from public authorities as close as possible to the people - local governments [7].
On June 12, 2020, the Cabinet of Ministers of Ukraine adopted an order on the definition of
administrative centers and approval of the territories of regional communities. As a result, 1,469 territorial communities have been established in the country (including 31 territorial communities in the uncontrolled territory within Donetsk and Luhansk oblasts).
State policy of Ukraine in the field of local self-government is based on the interests of residents of territorial communities and provides for decentralization of power - ie the transfer of executive power to local governments a significant part of powers, resources and responsibilities [1; 5]. This policy is based on the provisions of the European Charter of Local Self-Government and the best world standards of public relations in this area.
Legislative basis for a radical change in the system of government and its territorial basis at all levels began to take shape in 2014.
Table 4
Formation of united territorial communities in Ukraine as of the beginning of 2021
Name Area of the Population, Number of Number of
region, km 2 persons communities, units districts, units
Vinnytsia region 26513 1545416 63 6
Volyn region 20144 1031421 54 4
Dnipropetrovsk region 31914 3176978 86 7
Donetsk region 26517 1843578 46 5
Zhytomyr region 29832 1208212 66 4
Transcarpathian region 12777 1253791 64 6
Zaporozhye region 27180 1682534 67 5
Ivano-Frankivsk region 13900 1368097 62 6
Kiev region 28131 1781044 69 7
Kropyvnytskyi region 24588 933209 49 4
Luhansk region 26684 661028 26 4
Lviv region 21833 2512084 73 7
Mykolaiv region 24598 1119862 52 4
Odessa region 33310 2377191 91 7
Poltava 28748 1386978 60 4
Rivne region 20047 1152961 64 4
Sumy region 23834 1068247 51
Ternopil region 13823 1036590 55 3
Kharkiv region 31415 2654375 56 7
Kherson region 28461 1027913 49 5
Khmelnytsky region 20645 1254702 60 3
Cherkasy region 20900 1192137 66 4
Chernivtsi region 8097 901632 52 3
Chernihiv region 31865 991294 57 5
In general 575756 35161274 1438 119
Source: [7]
In April 2014, the Government approved the main conceptual document - the Concept of Reforming Local Self-Government and Territorial Organization of Power. After that, the Action Plan for its implementation was approved, which launched the reform. In order to implement the provisions of the Concept and the tasks of the Action Plan, it was necessary first of all to make appropriate amendments to the Constitution of Ukraine, as well as to form a package of new legislation.
Amendments to the Constitution were primarily intended to address the formation of executive bodies of regional and district councils, reorganization of local state administrations into control and supervisory
bodies, to give a clear definition of the administrative-territorial unit - the community.
Through the efforts of domestic specialists, practitioners, scientists, and experts, the draft amendments to the Constitution were developed and submitted for wide public discussion. The proposed changes were supported by the public and praised by the Venice Commission [7].
Analysis of the experience of implemented projects of economic development of rural areas in developed European countries allows us to identify the main accents that should be used in the development of rural development in Ukraine (Fig. 9).
Figure 9 - The main highlights of rural development in Ukraine
Source: [3]
The results of experimental research indicate that an incentive to continue living there. In the table 5 for rural areas of Ukraine, the intensification of provides information on the volume of foreign direct
diversification of economic activities is the only way to investment in Ukraine from 2010 to 2020. provide the rural population with sources of income and
Table 5
Foreign direct investment in Ukraine from 2010 to 2020 (million USD)_
Years To Ukraine Absolute From Absolute Balance Absolute
increase Ukraine increase increase
(current year) (+/-) to the (current year) (+/-) to the (current year) (+/-) to the
previous one previous one previous one
2010 6495 1679 736 574 +5759 23.7%
2011 7207 712 192 -544 +7015 21.8%
2012 8401 1194 1206 1014 +7195 2.6%
2013 4499 -3902 420 -786 +4079 -43.3%
2014 410 -4089 111 -309 +299 -92.7%
2015 2961 2551 -51 -162 +3012 907.4%
2016 3284 323 16 67 +3268 8.5%
2017 2202 -1082 8 -8 +2194 -32.9%
2018 2355 153 -5 -13 +2360 7.6%
2019 3070 715 648 653 +2422 2.6%
2020 -343 -3413 56 -592 -399 -116.5%
Source: [14]
To successfully solve the problems of European integration, the agricultural sector of Ukraine's economy has enough prerequisites: rich natural resources and export potential, significant human capital, gradually growing investment attractiveness, preserved rural life and centuries-old traditions of agriculture. In this context, research and scientific understanding of the experience of forming the
European agricultural model will contribute to structural reforms in agriculture and increase the competitiveness of agri-food products in European and world markets [4; 20].
In the table 6 and fig. 10 provides information on direct investment (equity) in the economy of Ukraine by type of economic activity by country in 2019.
Source: [8]
Table 6
Direct investment (equity) in the economy of Ukraine by type of economic activity by country in 2019,
thousand dollars USA
thousand dollars USA in% to the end
(as of January 1, 2019)
Total: incl. 32 905 116,6 -
Agriculture, forestry and fisheries: incl. 451 893,2 100,0
Denmark 53 301,3 11,8
The Netherlands 27 261,8 6,0
Germany 31 528,8 7,0
Poland 36 368,3 8,0
United Kingdom of Great Britain and Northern Ireland 25 257,0 5,6
France 27 327,5 6,0
Sweden 11 465,8 2,5
Cyprus 147 250,0 32,6
British Virgin Islands 12 145,7 2,7
USA 19 118,7 4,2
Others 60314,3 13,6
13,6
4,2
32,6
11,8
S «■*'
5,6
2,5 6
1 Denmark 1 The Netherlands 1 Germany 1 Poland
1 United Kingdom of Great Britain and
Northern Ireland 1 France
1 Sweden
1 Cyprus
1 British Virgin Islands USA
Figure 10 - Direct investment (equity) in the economy of Ukraine by type of economic activity by country in
2019, thousand dollars USA
6
7
Source: [8]
Adaptation of agricultural policy standards with transparent and predictable regulatory rules will help improve the investment climate and investment attractiveness of the agricultural sector of the economy for European partners. Significant potential of the agro-industrial complex is also associated with the combination of agricultural producers in Ukraine and the EU in production chains and sales channels. This will increase the productivity of the agro-industrial complex through the transfer of advanced technologies and practices of the EU, increase the scale of activity in the production and processing of agricultural products, improve access to world markets [9].
In general, sustainable economic development is an objective necessity for the further development of production relations in the world. As you know, the basis for determining the goals of sustainable development of agriculture was the concept of the multifunctional role of agriculture, according to which agriculture performs many functions in society - the production of safe and healthy food; assistance to sustainable rural development, first of all, protection
and improvement of the environment. This concept was adopted at the FAO conference (Ukraine became a member of this international food and agricultural organization in 2003) in the Netherlands (Maastricht) in September 1999 fill.
In the context of the crisis situation in the system of European and world security, as well as the crisis of the euro area, the study of the mechanisms of development of the agricultural sector of the national economy in the modern realities of integration processes are extremely relevant. One of such modern mechanisms is the functioning of the free trade zone between Ukraine and the EU The current state of agriculture and its «reaction» to the opening of EU markets for Ukrainian agricultural products, as well as prospects for further integration are of scientific interest [211.
Rural development involves improving the socioeconomic conditions in rural areas by improving employment opportunities, increasing household incomes and mobility of their members fl, p. 154]. In our opinion, rural development is a well-founded
process of successive economic, social, political, cultural and environmental changes aimed at improving the quality of life, which should meet the needs of the rural population and not pose a threat to future generations [2].
On the basis of the studied experience in Ukraine it is expedient:1) to develop a complex of regional programs of development of rural territories taking into account natural-geographical features and an existing condition of development of rural territories; 2) focus public policy on the development of human capital as the basis for the functioning of the village; 3) to provide an appropriate institutional structure capable of continuous monitoring of the state of rural areas and facilitate the exchange of experience with European countries and other developed countries.
The implementation of these measures and further research and development to improve the Rural Development Policy in Ukraine is the key to effective economic growth of the agricultural sector and the economy of Ukraine as a whole [19].
Discussion and Conclusions. The development of rural areas of Ukraine is one of the priorities of Ukraine's state policy aimed at solving economic, social, domestic, environmental, humanitarian, demographic and other problems of Ukrainian villagers, who make up a significant, and in some regions - the majority of our population.
Modern financial policy of rural development should be implemented through the cooperation of resources of the state, business (investors) and the population and aimed at stimulating entrepreneurial activity, creating new jobs, expanding the scope of employment, creating a favorable investment climate, etc., which will ultimately ensure self-sufficient development of rural territorial communities.
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