Institutional Foundations of de-Shadowing the Economy of Ukraine in the National Financial Security System

Abstract

The growth of the shadow sector of the economy of Ukraine has a considerable destabilising impact on the country’s financial sector, as a result of which increase threats, risks, challenges, and dangers to the financial security of the state, which intensify the macroeconomic and socio-political crisis. Under such conditions, the problems of justifying the institutional foundations and determining the vectors of de-shadowing the Ukrainian economy are being updated, the solution of which will ensure an optimal level of financial security of the state. The purpose of this study was to expand research on the theoretical foundations and practical recommendations on the institutional foundations of de-shadowing the Ukrainian economy in the national financial security system. The theoretical and methodological framework of this study included methods of analysis and synthesis, analogy and comparison, generalisation and systematisation, and a graphical method. The essence of the shadow economy, financial security, de-shadowing of the economy was determined and the place of the shadow economy in the system of national financial security was outlined, the influence of the shadow economy on the level of financial security of Ukraine and the dynamics of the level of the shadow economy, changes in the volume of real GDP of Ukraine, the dynamics of the level of the shadow economy of Ukraine in the context of economic activities, and the dynamics of the volume and level of official GDP created by shadow wages was analysed. The main risks, threats, challenges, and dangers of the national financial security were investigated, and it was proved that one of its biggest threats is shadow economic activity. The main vectors of economy de-shadowing were considered and improvement of methodological tools for assessing the level of the shadow economy of Ukraine was proposed. Strategic priorities of de-shadowing the Ukrainian economy in the system of ensuring financial security of the state were defined, namely the development of legal conditions for de-shadowing wages and improving the quality and efficiency of public finance management. The obtained results of the study can be used by state authorities, forming financial policy, and determining the main vectors of de-shadowing the economy of Ukraine