Definition of the concept «real sector of the economy» and approaches to defining the financial potential in the real sector of economy of the region
Journal Title: Економіка. Фінанси. Право - Year 2019, Vol 4, Issue
Abstract
In today's market conditions, the issue of financing, development and effective activity of the real sector of the economy of Ukraine in the conditions of the global financial crisis becomes especially urgent. An increase in the volume of financial resources of economic entities can be achieved through effective interaction between the financial and real sectors of the economy, the establishment of mutually beneficial, partnership relations between commercial banks and enterprises, the increasing role of banking institutions in ensuring the continuity of the reproductive process at the micro level through their active participation in the processes of individual capital reproduction domestic enterprises. However, despite the market transformation of the domestic economy, the participation of banking financial institutions in investing in the real economy remains low. This condition is associated with the absence of an effective mechanism for transforming savings into investments, lack of trust in banks and their low capitalization. In the scientific article the complex approaches of scientists to the identification of the essential characteristics and classification aspects of the real sector of the economy are considered. The issue of theoretical and methodological aspects of the formation and increase of the efficiency of the use of financial potential of the Real sector of the region's economy as a factor affecting the production and economic situation regarding the rapid change of the internal and external market conditions becomes especially acute. The analysis of theoretical material on the problem of determining the financial potential of the real sector of the region's economy in the article shows that most of the modern studies deal with certain aspects of the concept of "potential". The view that financial potential should be considered not only as the ability of enterprises to attract and rationally use financial resources, but also as an important reproductive component of production capacities of enterprises is supported. It is concluded that sustainable economic development of regions is largely determined by the efficiency of financial and credit relations and is mainly due to the financial stability of economic entities.
Authors and Affiliations
Irina Ihorivna Sukhovetruk
Keywords
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