Financial issues of regional development and interregional cooperation of Ukrainian regions
Benefits of issuing municipal bonds to local authorities and their attractiveness for potential investors. Types of institutions in the financial infrastructure of the region operating in developed countries and their role in financing regional needs.
| Рубрика | Иностранные языки и языкознание |
| Вид | статья |
| Язык | английский |
| Дата добавления | 31.08.2018 |
| Размер файла | 156,8 K |
Отправить свою хорошую работу в базу знаний просто. Используйте форму, расположенную ниже
Студенты, аспиранты, молодые ученые, использующие базу знаний в своей учебе и работе, будут вам очень благодарны.
Размещено на http://www.allbest.ru/
УДК 336.763.33
FINANCIAL ISSUES OF REGIONAL DEVELOPMENT AND INTERREGIONAL COOPERATION OF UKRAINIAN REGIONS
T.V. Marena
The growing needs for efficient use of the economic potential of Ukrainian regions, the desire to achieve a high level of economic independence of regions actualize the development of interregional cooperation - both domestic and international. Formation and deepening interregional economic relations should be based on financial terms and mechanisms established in the country that ensure the needs of regional development.
Requirements for the high level independence of local authorities while performing their delegated and assigned functions through own and assigned income provided by the European Charter of Local Self-Government, raise the issue of financial support for regional development and interregional cooperation. However, a significant number of problems that confine the economic independence of local authorities and hinder the development of interregional cooperation in Ukraine are found in the financial area.
The issues of financial support for regional development and formation of financial infrastructure in the region are considered in the research works of the Ukrainian scientists -
O.Butska, O.Vasyliev, I.Mazur, A.Cherep etc., as well as experts of research institutions, including scientists of the National Institute for Strategic Studies. Nevertheless, there is a lack of research aimed at obtaining a comprehensive conception of the state of the financial component of interregional cooperation in Ukraine, problems of financial support of the local communities and regions development and the possibility to use the experience of developed countries in the field of the financial infrastructure of interregional cooperation.
This paper is aimed at determining the main problems of the financial support for regional development in Ukraine and defining directions of their solution by means of implementation of international experience of establishing financial terms for regional development and interregional cooperation.
According to the scientists of the National Institute for Strategic Studies, the most significant financial barriers that hinder spreading the practice of interregional cooperation in Ukraine are: insufficient number of financial infrastructure institutions that would implement financial resources support for interregional projects and low level of municipal securities emission [6].
In the developed countries the practice of debt securities emission by regional and local authorities is widespread. In the United States, almost all municipal borrowings are issued in the form of municipal bonds. In average 8-14 thousand emissions a year are carried out totaling more than 300 billion dollars. Municipal bonds market in the USA is the largest in the world - both in absolute amount (about 1.5 trillion dollars), and the share in the domestic debt securities market (about 11%) [2]. In some countries, projects for the development of the municipal bonds market are implemented as a part of broader projects of municipal borrowing development or local government development in general with support of international institutions and donors.
Since the late 90s in the developed countries there is a trend of gradual displacement of municipal bonds from national securities markets by moving them to Eurocurrency markets. Particularly active borrowers in Eurocurrency markets are the Canadian provinces, German states, the Italian regions and Brazilian provinces. In particular, the Canadian province of Ontario borrows on the Eurobond market more resources than central government of Canada [2].
Municipal bonds market is quite attractive for local authorities. First, it allows to resolve the issue of additional sources of financing investment projects and projects of interregional cooperation. Second, the formation of municipal debt in the form of securities can make it more liquid, as a result reducing the cost of borrowing. Third, reducing the cost of borrowing is also possible due to lower interest rates owing to competition among investors. In addition, ensuring repayment of the bonds in time, the city (region) creates its own positive history of borrowing, which will allow to issue more municipal bonds in future [5, 9]. On the other hand, investments in municipal bonds can be more attractive due to tax-free status, which is often officially given to income obtained from municipal bonds.
Today the municipal bonds market is quite promising, but poorly developed segment of the Ukrainian stock market. The activity in this segment of the stock market is volatile. In
2011 municipal bonds in Ukraine were issued by 16 regional centers and 14 other cities. In
2012 1140 securities were included in the Stock list of the PFTS Stock Exchange and among them only 20 municipal bonds were noted (1.75%), in 2011 municipal bonds amounted to 0,50% [6].
In 2015, the National Securities and Stock Market Commission of Ukraine didn't register any municipal bonds issue, as it is reflected in Table 1.
Among overall quantity of municipal bonds issues that were traded on the stock market in 2015, only 4 issues (5.9%) were admitted to trading on the stock exchanges. This is the lowest indicator for the analyzed period both in absolute (see Table 1), and in relative dimensions (the share of municipal bonds issues, which were admitted to trading on the stock exchanges amounted to: 30.9% in 2011, 29.9% in 2012, 20.9% in 2013, 11.8% in 2014).
In addition, in 2015 six issues of municipal bonds was admitted to trading on the stock exchanges in the category of unlisted securities that do not meet the requirements of exchanges towards instruments of first and second listing levels. In particular, in the Stock list of the PFTS Stock Exchange there were three municipal bonds issues of this category,
Perspektiva Stock Exchange - two issues and Ukrainian Exchange - one municipal bonds issue.
Table 1 Indicators of municipal bonds market in Ukraine in 2011-2015
|
Indicator |
2011 |
2012 |
2013 |
2014 |
2015 |
||
|
The volume of registered issues of municipal bonds, million UAH |
584,5 |
5680,3 |
0,0 |
2375,0 |
0,0 |
||
|
Number of issues of municipal bonds, that are traded on the stock market, items |
55 |
67 |
67 |
68 |
68 |
||
|
Number of issues of municipal bonds, that are admitted to trading on the stock exchanges, items |
17 |
20 |
14 |
8 |
4 |
||
|
Number of issues of municipal bonds, that are not admitted to trading on the stock exchanges, items |
38 |
47 |
53 |
60 |
64 |
||
|
Trading volume on the stock market, billion UAH |
2171,1 |
2530,9 |
1676,9 |
2331,9 |
2172,7 |
||
|
The volume of municipal bonds traded on the stock market, billion UAH |
1,67 |
7,48 |
3,60 |
4,11 |
2,43 |
||
|
The share of traded municipal bonds in the overall volume of stock market, % |
0,08 |
0,30 |
0,21 |
0,18 |
0,11 |
The share of municipal bonds in the total volume of exchange contracts is constantly decreasing, down from 2.42% in 2012 to 0.007% in 2015 (Fig. 1). In 2015 the highest demand in the stock market was formed for the bonds of following issuers: Kremenchug City Council of Poltava region (bonds were traded on the PFTS Stock Exchange, Kyiv City Council (bonds were traded on East European Stock Exchange, PFTS Stock Exchange, Perspektiva Stock Exchange), Cherkasy City Council PFTS Stock Exchange).
The overwhelming share of municipal bonds in recent years is traded on the over-the- counter (OTC) market. For instance, among the total volume of trading municipal bonds in 2015 (2.43 billion UAH) 2.41 billion UAH or 99% were traded on the OTC market. The highest demand in the OTC market in 2015 in terms of executed contracts was formed for the bonds of following issuers: Kiev City Council, Donetsk City Council, Kremenchug City Council.
Another problem of financial support of Ukrainian regions interregional cooperation is insufficient number of financial infrastructure institutions that could implement financial resource support for interregional projects and ensure circulation of municipal securities.
Figure 1. The volume of exchange contracts for municipal bonds and their share in the total exchange contracts volume in 2011-2015
The necessity of such institutions activity within the regional economy is proved by international practice. The system of regional financial infrastructure institutions can comprise banks for development, municipal banks and other lending institutions to finance local development, collective investment institutions etc. municipal bond investor financial
In Ukraine, a regional network of such institutions is poor and straight. Most of them are concentrated in large cities, and only in some small towns and peripheral regions subsidiaries of commercial banks works, which are unable to meet the specific local demand for financing [6].
One of the ways towards the development of local and regional financial infrastructure is the creation of specialized financial institutions - communal or municipal banks which would exclusively finance problems of regional development.
International practice shows that communal banks are particularly widespread in Western Europe. Typically, municipalities (city councils) have a controlling stake of municipal bank (51% of the authorized capital), the rest of the funds is financed by city companies, monetary contributions of businesses and individuals. The most important component of these banks credit resources is money obtained after municipal securities sale. The communal bank acts as a guarantor for municipal obligations. Communal bank specialization is shown in the fact that its activity is not aimed at conducting cash transactions, but at providing loans to meet local needs. One of the priorities of the communal bank is to finance interregional infrastructure projects. Municipal banks are mostly widespread in Germany, where they account for about 40% of the credit system balance. In Ukraine today there is no bank the only founder of which is the local authority [1, 8].
In addition to the communal banks, developed countries have an extensive network of municipal financial institutions. Special form of communal banking institutions is Girozentrale (German) or Girobanks. First Girozentrale appeared in Germany in 1908. Girobanks are an effective form of mutual settlements facilitation between local authorities. Settlements by means of Girobanks are provided without the mediation of money in the form of special current accounts.
Communal banks of mutual loans successfully operate in Sweden, where they emerged in the XIX century. These banks are intermediaries through which local authorities can lend to other local authorities. Communal banks of mutual loans are established in Sweden in the form of banks of joint liability of their founders (communities) without state guarantees. Swedish communes form unions for mutual lending within districts. Each union is a mutual lending bank. Communes are jointly responsible for these banks debts.
Another type of communal banks is a stock communal bank, which founders are responsible within their own stake. The first bank of the kind was established in 1860 in Belgium as a municipal loan company. Only the communities could be its shareholders.
An important role in the regional financial infrastructure is played by special state banks of municipal loan specializing in lending to local authorities. They are usually closely related with the system of savings banks. Banks of the kind operate in Germany, France, Italy, UK, Belgium. In France, there are also regional companies of investments finance formed as joint stock companies with equal equity participation of deposit and savings banks. There are a number of commercial banks that specialize in lending to local authorities. In France, for instance, there is a system of branches of Bank for agricultural loan. They provide loans mainly to small rural communities. In addition, this bank's branch called “French provincial” provides assistance to the administrative and territorial units with the bond issue.
Thus, while there is an extensive network of specialized financial institutions of communal type in developed countries, Ukraine lacks even basic regional financial institutions - municipal banks. One of the obstacles to their creation is the absence of the clear legislative procedure for their establishment.
Developed network of regional financial institutions has a dual role: on the one hand, it provides municipalities with financial resources through the communal loans; on the other hand, it provides municipal bonds underwriting.
In international practice, municipal bond borrowing is an important source of local government financing; a powerful financial instrument that helps to solve current and longterm problems associated with the financing of public spending; financial base for interregional cooperation implementation. However, despite all the advantages, issues of municipal securities hare not widely spread in Ukraine. In recent years new issues of municipal bonds in Ukraine were carried out mainly to refinance previous loans. Further development of the municipal bond market is largely constrained by incomplete reform of municipal finance.
Identification of the Ukrainian regions having the greatest potential of establishing specialized municipal banks, which would be able to provide financial support for interregional cooperation projects can be the subject of further research in this area.
List of references
1. Буцька О.Ю. Комунальний банк як інститут сприяння соціально-економічного розвитку територіальних громад / О.Ю. Буцька, О.В. Тимошенко // Інвестиції: практика та досвід. - 2013. - № 20. - С. 44-46; Butska O.Iu. Komunalnyi bank yak instytut spryiannia sotsialno-ekonomichnoho rozvytku terytorialnykh hromad / O.Iu. Butska, O.V. Tymoshenko // Investytsii: praktyka ta dosvid. - 2013. - № 20. - S. 44-46.
2. Васильєв О.В. Організація функціонування фінансових інституцій регіону / О.В. Васильєв // Економіка. Управління. Інновації. - 2013. - № 1.. - Vasyliev O.V. Orhanizatsiia funktsionuvannia finansovykh instytutsii rehionu / O.V. Vasyliev // Ekonomika. Upravlinnia. Innovatsii. - 2013. - № 1.. - Rezhym dostupu: http://nbuv.gov.ua/j- pdf/eui_2013_1_8.pdf.
3. Васильєв О.В. Особливості взаємозв'язку між економічним розвитком регіону та його фінансовою інфраструктурою / О.В. Васильєв // Економіка. Управління. Інновації. - 2013. - № 5(43). С. 123-127; Vasyliev O.V. Osoblyvosti vzaiemozv'iazku mizh ekonomichnym rozvytkom rehionu ta yoho finansovoiu infrastrukturoiu / O.V. Vasyliev // Ekonomika. Upravlinnia. Innovatsii. - 2013. - № 5(43). S. 123-127.
4. Мазур І.І. Особливості становлення ринку муніципальних паперів в Україні / І.І. Мазур // Стратегічні пріоритети. - 2010. - №1. - С.23-28; Mazur I.I. Osoblyvosti stanovlennia rynku munitsypalnykh paperiv v Ukraini / I.I. Mazur // Stratehichni priorytety. - 2010. - №1. - S.23-28.
5. Череп А.В. Комунальний банк як інвестиційна складова соціально- економічного розвитку територіальних громад / А.В. Череп, С.О. Осипенко // Бізнес Інформ. - 2015. - № 11. - С. 314-319; Cherep A.V. Komunalnyi bank yak investytsiina skladova sotsialno-ekonomichnoho rozvytku terytorialnykh hromad / A.V. Cherep, S.O. Osypenko // Biznes Inform. - 2015. - № 11. - S. 314-319.
6. Штерн Г.Ю. Ринок муніципальних облігацій в Україні / Г.Ю. Штерн, О.А. Карлова, К.В. Погосьян // Коммунальное хозяйство городов. Научно-технический сборник. - 2006. - № 70. - С. 323-327; Shtern H.Iu. Rynok munitsypalnykh oblihatsii v Ukraini / H.Iu. Shtern, O.A. Karlova, K.V. Pohosian // Kommunalnoe khoziaistvo horodov. Nauchno-tekhnycheskyi sbornyk. - 2006. - № 70. - S. 323-327.
Annotation
The paper considers the problems of financial support for regional development and interregional cooperation, among which there are low level of municipal securities emission and insufficient number offinancial infrastructure institutions that would implement financial resources support for interregional projects. Advantages of municipal bonds issue are defined and international experience of municipal securities issue is considered. The performance of municipal bonds market in Ukraine is analyzed. Types of financial institutions of regional infrastructure, operating in developed countries and their role in regional needs financing are characterized. Forms of existence and activities of municipal banks are defined. Obstacles to the development of the municipal bonds market and the establishment of municipal banks and other financial institutions of regional infrastructure in Ukraine are determined.
Key words: interregional cooperation, regional development, municipal borrowings, municipal bonds, regional financial infrastructure, communal (municipal) bank.
У статті досліджено проблеми фінансового забезпечення регіонального розвитку та міжрегіонального співробітництва, до головних з яких віднесено незначний рівень емісії муніципальних цінних паперів та недостатню кількість установ регіональної фінансової інфраструктури, які могли б здійснювати ресурсне забезпечення міжрегіональних проектів. Розглянуто світовий досвід функціонування ринків муніципальних цінних паперів, зокрема, досвід Сполучених Штатів, де сформувався найбільший у світі ринок муніципальних облігацій. Визначено переваги випуску муніципальних облігацій для місцевих органів влади та їх привабливість для потенційних інвесторів.
Проаналізовано показники розвитку ринку облігацій місцевої позики в Україні. Встановлено, що ринок муніципальних облігацій є слабо розвиненим сегментом українського фондового ринку. Визначено, що через низьку якість цінних паперів незначна частка облігацій місцевих позик допускається до біржових торгів, більшість муніципальних облігацій або торгуються за категорією позалістингових цінних паперів, або обертаються на позабіржовому ринку. Зазначено, що подальший розвиток ринку муніципальних облігацій в країні значною мірою стримується незавершеністю реформи системи муніципальних фінансів.
Охарактеризовано види установ фінансової інфраструктури регіону, які діють у розвинутих країнах, та їх роль у фінансуванні регіональних потреб. Визначено напрями діяльності муніципальних банків, розглянуто форми їх існування у країнах Західної Європи. Визначено, що розвинута мережа регіональних фінансових інститутів виконує подвійну роль: з одного боку, забезпечує муніципалітети фінансовими ресурсами через надання комунального кредиту, а з іншого - забезпечує розміщення муніципальних облігацій. Встановлено, що в Україні регіональна мережа таких установ є нерозвиненою і нерозгалуженою, відсутні навіть базові фінансові установи регіонального рівня - муніципальні банки. Визначено, що головною перешкодою на шляху до створення муніципальних банків та інших установ регіональної фінансової інфраструктури в Україні є відсутність на законодавчому рівні чітко встановленого порядку їх заснування.
Ключові слова: міжрегіональне співробітництво, регіональний розвиток, муніципальні запозичення, облігації місцевої позики, фінансова інфраструктура регіону, комунальний (муніципальний) банк.
Размещено на Allbest.ru
...Подобные документы
Features of financial planning in June. Summary and objectives of the financial plan in August. Of the Financial Planning business in Ukraine. Role of financial management of enterprises. Improving financial planning in modern business environment.
курсовая работа [28,4 K], добавлен 11.05.2011The banks history. Origin of the word. The earliest evidence of money-changing activity. A bank as an institution that deals in money and its substitutes and provides other financial services. Types of banking institutions. Loans, checks and savings.
реферат [884,8 K], добавлен 19.04.2011The concept of transnational corporation, history of their development. The evolution of a Transnational Corporation, classification. TNCs’ role in mobilizing financial resources and the impact on investment. Transnational corporations and agriculture.
дипломная работа [2,7 M], добавлен 04.06.2011The concept, types and importance of enterprise infrastructure. Provided producing technologically-advanced enterprise infrastructure. Problems of infrastructure in enterprises of Ukraine. Reproduction and development of enterprise infrastructure.
реферат [30,0 K], добавлен 29.10.2011Palm oil is a form of edible vegetable oil obtained from the fruit of the oil palm tree. Chemistry and processing. Environmental, social and cultural impact. Biofuels and bioproducts. Regional production. Health. Blood cholesterol controversy.
реферат [23,8 K], добавлен 12.05.2008Positive proposals needed, objections to centralisation, embrace New Zealand. Renaming the states, democratic considerations. Land management, planning, financial and geographical considerations. Local government in provincial cities and the country.
эссе [66,2 K], добавлен 24.06.2010Business as a combination of types of activities: production, distribution and sale, obtaining economic profit. Basic types and functions of banks. The principle of equilibrium prices and financial management. The use of accounting in the organization.
контрольная работа [17,8 K], добавлен 31.01.2011Users and uses of financial information. Range of areas of the accounting and finance. Financial activities and their management. Securities and stock exchanges. Parts of the balance sheet: assets and liabilities. Main external sources of finance.
контрольная работа [20,7 K], добавлен 20.05.2010Politics ukrainization, conducted by the bolsheviks. National and spiritual revival of Ukraine after the First World War. Proofs of regional revitalization movement. Museum of local traffic as a kind of excursion. Preferential tourist activities.
реферат [17,9 K], добавлен 10.05.2011Education encompasses teaching and learning specific skills, and also something less tangible but more profound: the imparting of knowledge, positive judgment and well-developed wisdom. Systems education. Process. Teaching. Technology. Economics.
реферат [19,0 K], добавлен 14.05.2008Negotiations, contract, agreement, protocol. Writing of text of contract for negotiations. Financial world. Computers in our life. Scientific conference. Preparation of lecture about your scientific research. The relations with the new clients.
учебное пособие [32,4 K], добавлен 05.05.2009Disintegration of the USSR. Restoration of Russia. Influence of the open market. The Asian financial crisis. Increase of local manufacture. Fast lifting of economy, gross national product. Export of consumer goods. Fluctuations in the world prices.
топик [12,4 K], добавлен 04.02.2009English language: history and dialects. Specified language phenomena and their un\importance. Differences between the "varieties" of the English language and "dialects". Differences and the stylistic devices in in newspapers articles, them evaluation.
курсовая работа [29,5 K], добавлен 27.06.2011Russian mass media as the tool of democracy. The law on mass-media of 1991. Strengthening the rights of mass-media and their restriction. Role of the state in becoming. Latent forms of the state intervention. Monitoring by authority of regional editions.
контрольная работа [16,4 K], добавлен 17.04.2011Investigation of the recreational potential of Anapa: sights, famous beaches and health and preventive services. Assessing the current state of tourism infrastructure. Development of the excursion program for 8 days in the resort town of Russia.
курсовая работа [5,7 M], добавлен 25.06.2011Switzerland is a traditional country of tourism. A tourist infrastructure is developed in a country. Picturesque nature and advantageous geographical position provides an influx in the country of great number of tourists. Known resorts of Switzerland.
реферат [31,4 K], добавлен 18.07.2009Taras Shevchenko and a new epoch in the development of the Ukrainian literature and in the social and cultural life of the whole Ukrainian people. Ivan Franko is one of the innovators of all genres of literature. Poems of the great poetess Lesia Ukrainka.
контрольная работа [19,1 K], добавлен 05.11.2010Canada as the largest country of the North America. Geographical position of Canada, its climate, relief and environment. The population, religion and moving types. History of development of territory. A state system, the basic provinces of Canada.
реферат [20,6 K], добавлен 17.02.2010Use of jargons to make more specific expression of thoughts. Theoretical information on emergence and development of a slang. Jargon in Finance. Some examples of use of a financial jargons which were found in scientific articles. Discourse analysis.
реферат [20,1 K], добавлен 06.01.2015Origin of the comparative analysis, its role and place in linguistics. Contrastive analysis and contrastive lexicology. Compounding in Ukrainian and English language. Features of the comparative analysis of compound adjectives in English and Ukrainian.
курсовая работа [39,5 K], добавлен 20.04.2013
