Attracting Foreign Investment in Cyclic Imbalances of the Economy

Abstract

Foreign investment is an important economic resource for many countries including Ukraine. The relevance of this study lies in the need to solve problems of attracting foreign investment. The purpose of this study was to consider the conditions for attracting foreign investment in the cyclic imbalances of the world economy. Using the method of correlation-regression analysis, the impact of indicators of financial imbalances was found both in general and by individual sub-indices. The study found the financial imbalances (fiscal, monetary, exchange rate, debt, trade, households, investment, and savings), both present and potential, in the face of the threat of financial and economic crisis. The procedure for assessing financial imbalances in economic activity of the world and their regional groups that implement the process of investment-oriented development was defined. To assess their impact on the volume of foreign direct investment, a comprehensive method of calculating sub-indicators of financial imbalances was proposed, which on the set of certain parameters forms an integrated index of financial imbalances. Methodological approaches to determining the restrictive procedures for the accumulation of financial imbalances associated with the transition of the financial system to a state of financial danger, considering the budget, currency, monetary and debt components were substantiated. The complex method of calculating sub-indicators of financial imbalances in the economy involves the identification of economic risks at the initial stages using the Alert Mechanism on the violation of the balance of the financial and economic systems of the participating countries. Priority areas (real estate and professional services) for attracting foreign investment from around the world were identified. The geostrategic matrix of attraction of foreign investments by the countries of the world was offered.

Untitled

“…Nevertheless, it is difficult to agree with the conclusion that financial stability and economic growth should be achieved by different instruments of public policy. Thus, if financial stability is lacking, the flow of investment, especially foreign direct investment, may be significantly reduced, which in turn will lead to lower economic growth, and there are many examples of this (Heimberger, 2021;Trusova, 2022). Such assessments require additional analysis to form full-fledged conclusions.…”

Blockchain and fintech technologies in the digital space of financial and industrial companies

“…The paper by [44], [45], [46] delves into strategies and challenges of attracting foreign investment during cyclic imbalances in the economy. The authors emphasize foreign investment as a driver of economic growth and development, examining different types of foreign investment, such as foreign direct investment (FDI) and portfolio investment.…”

Volume 13, No. 1, 2024

“…This significantly reduces the risk of non-return of investments, due to the division of the total amount of sources of investment flow into shares in order to preserve the right of ownership for the acquisition of assets and their further use. In addition, activation of investment opportunities (transition from the stage of attracting loan resources to an investment transaction) allows creating additional guarantees of return of invested own resources (Global investment platform convergence, 2014; Trusova et al, 2022).…”

“…The indicator of financial support for producers (IFSP), measures the annual value of redistributed budget investment flows for the development of subjects of the agro-food industry and determines the share ("threshold") of potential assistance for the activation of investment opportunities, regardless of their branch affiliation, goals or income. The values of IFSP are calculated by adding to the support of market prices the share of the flow of budgetary investment directed to producers (Global investment platform convergence, 2014; Ivanyshyn, 2011;Miller & Coble, 2008;Muzychenko, 2015;Trusova et al, 2022).…”

“…International Journal of Agriculture and Biosciences 13(1): 1-17. https://doi.org/10.47278/journal.ijab/2023.077 investment opportunities of the sub-jects. These questions are considered in the works of classics such as: Bae and Goyal (2009), Brown et al (2009), Filatova (2021), Irtyshcheva and Stehnei (2009), Ivanyshyn (2011), Katsan (2018), Kisil and Kozhemiakina (2012), Kravchun (2018a), Levchynskyi (2011), Lsobas (2012), Makukh (2009), Malskyi and Bilenko (2016), Muzychenko (2015), Trusova, et al (2022). The problems of state regulation, formation and implemen-tation of investment policy, formation of the economic model of investment activity of subjects of the agro-food sector at the national level are discussed in scientific works of Kravchun (2018b), Lebid (2016), Mathe (2013), Melnyk et al (2019), Miller and Coble (2008), Nechytailo (2011), Nehoda (2019), Nepochatenko and Bondarenko (2011), Nosova (2007), Smaliukh (2017), Trusova et al (2021), Zhulavskii and Ko-bushko (2011).…”