The activity of OZ is assessed very ambiguously by specialists.

This is competition between enterprises of different sectors of the economy – state and cooperative, in science and technology (competitive projects lab report writer for you, parallel research and development), competitions for public resources, rational placement of enterprises, identification of production reserves, social orientation of individual sectors of the economy.

We need a system of counterbalance to monopolization, granting companies the right to join intersectoral associations, the creation of large economic entities such as concerns or factories.

The newly created self-governing system should be dominated by the state, which should ensure a balance in the national economy of the number of jobs and available labor resources in large regions and industries and the appropriate socio-economic security.

The creation of joint ventures with foreign countries in Ukraine will help increase contributions from profits to the state budget of Ukraine.

It is advisable to preserve or close some secondary industries, the products of which are more profitable to import, as well as the development of industries with a favorable export orientation.

Improving the sectoral structure of Ukraine’s economy requires a significant balance in the development of mining and manufacturing industries, as well as industries that produce and consume tools.

The necessary proportions can be achieved through the improvement of investment policy, management, savings of raw materials and energy largely through the production of resource-saving equipment.

Shifts in the sectoral structure of Ukraine’s economy should reflect the process of intensification of production and be determined primarily by the development of industries that determine scientific and technological progress and growth in the production of consumer goods.


International business: essence and forms. Abstract

Each form of IEA is reflected in international business, and based on them we can talk about such types of international business as currency, industrial, financial and credit, trade, agriculture – each of which has its own subspecies. The most significant manifestations of international business are joint ventures and transnational businesses

The essence of international business. International business is a part of the general system of IEA, which corresponds to the relations connected with business activity of industrial, commercial, currency-financial, transport types.

Each form of IEA is reflected in international business, and based on them we can talk about such types of international business as currency, industrial, financial and credit, trade, agriculture – each of which has its own subspecies.

The most significant manifestations of international business are joint ventures and transnational businesses.

Joint venture

Joint venture is an activity in which joint capital is formed, formed from the share contributions of partners of two or more countries that jointly carry out economic activities, managing the established joint venture and distributing the profits in proportion to the invested capital.

JVs are classified according to the following characteristics:

Affiliation of participants (industrialized; developing; subjects of countries with economies in transition). The structure of partners (private, public, mixed). Share of partners’ participation in the joint venture’s capital (what is the percentage share of the local or foreign partner in the joint venture). Type of activity of the joint venture.

Factors hindering the development of joint ventures:

general instability of the economic and social situation of the country. low level of market infrastructure. non-convertibility of the national currency. imperfection of legislation.

Transnational business

A multinational company (TNC) is a company whose parent company and owner are located in one country, and branches or subsidiaries are located in the same country, and necessarily in other countries.

A multinational company (MNC) is a company that is a cooperative association of a small number (2-3) of parent companies in several countries and a wide network of branches or subsidiaries of these companies operating in different countries.

The main features of TNCs:

Possession of huge material and financial potential. TNCs are the bearers of advanced achievements in science and technology. International in the field of functioning and use of capital.

TNCs play an important role in the development of developing economies. At the same time, TNCs develop the industry of these countries, provide access to their financial resources and technologies, training, and promote the national products of developing countries to foreign markets.

But on the other hand, these countries are becoming a raw material appendage of TNCs, ecologically harmful production is exported here, which forces these states to exercise various forms of control over the activities of TNCs.

Free economic zones

There are many obstacles to the development of international business, one of which is the presence of customs barriers at the borders between states. In contrast to domicile barriers, the process of creating free economic zones has been rapidly developing recently.

A free economic zone is a part of the territory separated from the general customs borders of the state, which has full independence in resolving economic issues, a special management regime and preferential conditions of economic activity for foreign and national business entities.

The urgent need to create SEZs in Ukraine is due to the crisis situation in most areas of the economy and the transition to an open market economy. Some regions see the way out of the crisis in the expansion of their economic independence and better use of the features and uniqueness of their territories. The regions also felt the effect of direct foreign economic relations, the expansion of cross-border trade and the attraction of foreign investment.

But foreign partners agree to increase the share of investments only with certain guarantees from the state. The interests of foreign investors can be taken into account at this stage only in the conditions of FEZ.

The main goals of the SEZ:

Work for the domestic market, helping to saturate it with advanced technology and high quality goods. To serve as a center for the country to develop and disseminate foreign management experience, a testing ground for new forms of management. Development of export industries. Modernization of certain sectors of the economy. Development of economically backward regions of the country. Development of market infrastructure. Promoting the development of the tourism business. Attracting foreign capital to the country.

To achieve these goals, the state, when creating the SEZ, specifically goes to limit state regulation of the economy in a certain part of its territory.

In the life cycle of SEZ there are 4 phases:

Development – the inflow of foreign capital increases and exports of products produced in the area increase, production becomes highly efficient.

Maturity – the inflow of foreign investment stabilizes, exports grow.

Recession – the inflow of foreign investment is falling, foreign investors are being pushed out by local firms, production capacity is being bought by national companies.

The zone is transformed.

In countries with developed market economies, there are many types of SEZs, each of which has its own characteristics and plays a role in the country’s economy.

The customs zone is the territory where foreign and domestic goods, as well as transit cargoes are stored, sorted, processed and completed. For example: Shannon Airport (Ireland).

Technoparks, technopolises are cities or with a high concentration of high-tech enterprises located near large scientific institutions that train scientific and engineering personnel for a technopolis; and housing with appropriate modern production and social infrastructure.

For example: Silicon Valley (Stanford University), California, Triangle Research Park in North Carolina, Technopolis in Japan.

Offshore zones (OZ) or “tax havens” as they are sometimes called, began to be organized in the 70’s. OZ attract customers with a favorable monetary and financial regime, a high level of banking and trade secrecy, loyalty to government regulation.

They are most common in the British Commonwealth. There are about three dozen sustainable and integrated centers of offshore activities in the world. Countries where offshore companies have been operating for a long time include Panama, the Channel Islands, Ireland, Switzerland, and others. In the last decade, OZs have appeared in Israel, Malta, and Malaysia.

Industrial, commercial and banking companies in healthcare are either not taxed at all (Ireland, Liberia) or are subject to a small flat tax. Preferential treatment in health care is also determined by the absence of currency restrictions, free export of profits, low capital, the absence of customs tariffs and fees for foreign investors, extraterritoriality, and others.

For countries that organize health, the benefit is to attract additional foreign investment, increase income, create additional jobs, which, in general, contributes to the development of the national economy.

Offshore business is concentrated, as a rule, in banking, insurance, shipping, real estate transactions in trust, in all types of export-import transactions in consulting.

The activity of OZ is assessed very ambiguously by specialists. Many agree that offshore centers are often a place of money laundering and all sorts of banking scams.

Many Ukrainian entrepreneurs create offshore companies in these health facilities, hiding income in hard currency in offshore accounts. This can be combated only by creating a preferential investment regime and preserving the currency in Ukraine. Otherwise, in the conditions of liberalization of foreign economic relations, the currency will flow abroad in increasing volumes.

Free ports – are created at ports and airports, the imported goods are not paid duty as long as it is in stock, and paid after its sale. For example: the port of Hamburg (Germany).

Export and import industrial zones are focused on foreign and domestic trade and are designed to provide the country with scarce goods, and local businesses with advanced technology.