Research of institutional aspects of the project financing of socio-economic development of the region

Abstract

The object of research is the institutional aspects of project financing of the socio-economic development of the region. One of the most problematic places is the opaque and imperfect system of applying the project approach to its financial support. The study presents a generalized and interpreted definition of project financing of the socio-economic development of the region as an innovative mechanism for financial support for the implementation of the strategic tasks of the socio-economic development of the region based on the project approach. The analysis of the problematic aspects of the institutionalization of state financial support for the development of the regions on the basis of the project approach: – funds of the State Regional Development Fund (SRDF); – subvention for the development of infrastructure of the united territorial communities (UTC); – funds of the state budget of Ukraine received from the European Union. An institutional approach has been applied to consider the mechanisms of interaction and relationships of subjects of public relations, assess their behavior in meeting the norms of distribution and use of funds for project financing. The key general and distinctive institutional aspects of project financing of socio-economic development of the regional level are identified. The main problematic aspects for improving the institutional foundations of project financing of the socio-economic development of the region are identified. It is substantiated in the work that the mismatch of projects with the objective of regional development strategies, the terms of reference for plans for their implementation, as well as lobbying for non-development projects, and « projects supporting current activities » do not contribute to the development of territories. The research results are recommended for use in practice by representatives of legislative and executive authorities making decisions on the use of project financing tools for the socio-economic development of the region. It is proposed to the expert commissions on the selection of regional development projects, the working groups on strategic planning for the development of territories to take into account the identified positive and negative factors in order to further clarify the mechanisms of state financial support for developing projects at the regional level.