VERTICAL INTEGRATION DEVELOPMENT CHARACTERISTICS IN AGROINDUSTRIAL COMPLEX
Journal Title: Економіка розвитку - Year 2012, Vol 64, Issue 4
Abstract
In the agrarian sector of the economy there are difficult production interbranch relations in the sphere of manufacturing, processing, sales of agricultural products. Integration processes in AIC cause the necessity for the system approach to the process of agrarian production development. To provide the equivalence of AIC interbranch relations it is necessary to develop organizational and economic measures of government control. It is necessary to develop the mechanism of government control for AIC integrated processes which will be able to provide operative adaptation of agriculture production to the new terms of economic management under the conditions of economic crisis. On the basis of effective development of interbranch connections between the AIC enterprises the integration formations will encourage the speed-up mastering of new agricultural products, the launch of the new trade channels to the international sales markets for domestic products. The AIC integration formations will advance the creation of the best conditions for the increase of products competitiveness, and production range enlargement. The advantage of AIC integration processes is to provide the production with competitive products and inter-proportional development of technological processes (production, provision, storage, processing, and also wholesale and retail trade). The agroindustrial integration is built with the way of combining holdings, financial structures, processing enterprises, enterprises of regional specialization. The formation of new agroindustrial associations on the basis of interbranch vertical integration will enable to improve substantially the economic efficiency of both agrarian production and all interconnected industries of agroindustrial sphere. The development of agrointegration processes will remove the imbalance between the AIC industries and create the economic advantageous conditions for the producers in the agrarian sector of the economy.
Authors and Affiliations
Alexey Tomilin
Keywords
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