Investment Climate Of Country Research Articles

INVESTMENT CLIMATE IN UKRAINE: SITUATION, PROBLEMSAND POSSIBLE WAYS OF IMPROVEMENT

The article presents the results of a study of the state, problems and possible ways to improve the investment climate in Ukraine in the new extreme conditions of doing business. Improving and stabilizing the investment climate in Ukraine during martial law is necessary to ensure economic development, attract international resources, rebuild infrastructure, strengthen the international image and protect national business. The purpose of the article is to study the state and problems of the formation of the country's investment climate in conditions of full-scale military operations, analysis of the main factors affecting the level of investment attractiveness of enterprises in conditions of uncertainty, study of the main ways and directions of improvement of the investment climate in Ukraine.As a result of the research, it was established that the investment climate should be defined as a set of political, economic, legal, social-cultural, scientific-technological, demographic, infrastructural and natural-geographical factors that form the degree of investment attractiveness and determine the level of investment risk. A model of the formation of the investment climate in Ukraine was built, taking into account the main factors of the internal and external environment of enterprises and organizations under martial law. The main threats and changes in the macro-environment of the country under the influence of the war are structured. It was found that there was not a single field of activity of economic entities that was not affected by the war. One of the main ways to improve the investment climate in Ukraine today is the insurance of military and political risks, which is an extremely important aspect for protecting capital investments and ensuring business development. It is the stabilization of the investment climate that will prevent the outflow of capital abroad and preserve resources for further development. In addition to large-scale infrastructure reconstruction projects, investments can be aimed at supporting small and medium-sized businesses, which are an important source of innovation and jobs.

Foreign Investments as a Factor Ensuring Economic Security of Ukraine

The article explores the theoretical foundations of the concepts of «security», «national security», «economic security», «investment security», and their interrelations within the components of a state's national security. The necessity of attracting foreign investments while considering economic security is emphasized. The authors propose their interpretation of the definition of «investment security in the sphere of foreign investment». Characteristics of national interests in the field of investment security are provided, and directions for forming a system to ensure it are identified. Sources of threats to attracting foreign investments for the domestic economy are identified. The dynamics of the balance of payments according to the financial account and the volumes of foreign direct investments for the years 2014-2023 are examined, providing insight into the country's investment climate. Attention is drawn to the significance of Ukraine's investment attractiveness index, which has been the lowest in the past decade since the onset of full-scale military aggression. This indicates that the investment climate in Ukraine does not contribute to an increase in foreign investment volumes. The analysis focuses on key indicators of investment security, including the investment attractiveness index and the ratio of net FDI inflows to GDP. It is elucidated that since 2016, there has predominantly been a deficit in the balance of payments, and the share of accumulation of foreign direct investment relative to GDP has not reached the threshold level of the indicator. It is highlighted that apart from state-level security factors, there are those that depend directly on the activities of economic entities, particularly the level of timeliness of accounting and analytical support for foreign investments. The main directions of ensuring economic security in the process of attracting foreign capital are determined.

საინვესტიციო გარემოს შეფასების აქტუალური საკითხები

საინვესტიციო გარემოს შეფასების აქტუალური საკითხები

Управління державним боргом України на сучасному етапі

Abstract. Introduction. The problem of public debt management is one of the main problems in Ukraine. Public debt has a significant impact on the financial system, the state of the economy in the country investment climate, national currency stability. The rapid growth in volumes of a gross external debt and in ratio to GDP increases the currency risks of the country. That’s why public structures must form and implement a clear process of public debt management. Purpose. The main purposes of the article are to investigate the theoretical aspects the management of the external state debt in Ukraine, to analysis of the current state of public debt, to identify the main problems the management of the external state debt and search for ways to improve it. Results. It was researched that the growth of the state debt and expends of its servicing are gaining in Ukraine. It was determined that the structure of public debt is dominated by external debt. Also Ukraine is characterized by large amounts of stateguaranteed debt, which involve additional costs due to the insolvency of borrowers. Ukraine has excessive debt burden mainly through external borrowing. During the study period, the maximum amount of public debt has long exceeded the norms approved by the Budget Code, although in the last two years there has been a stabilization. Therefore, a range of debt management actions have been proposed that can alleviate the problem of over-indebtedness in Ukraine and mitigate the risks associated with a distorted debt structure. As such, debt policy of a government must be based on gradual repayment of debt in foreign currency, optimization of state expenditures, improvement of the system of the national debt, refinement of the conditions by which governments service their debt, etc. Thus the government's debt policy should be based on an improved legal framework for regulating public debt; public debt restructuring; rational and targeted use of loans. In addition, the country should introduce strict control over the spending of funds, ensuring the political and economic development of Ukraine and take incentives to intensify the stock market.

Institutions and firms’ technological changes and productivity growth

We investigate long-run firm-level productive growth and technological changes and relate these to the formal and informal institutions and related factors. We conclude that persistency of easing of regulations through broader reforms, including privatization and perception of non-reversal of reforms, helped firms achieve prolonged productivity gains—led by technological changes alongside a socially desirable reduction in CO2 emissions due to energy saving, as well as increased labour usage, despite variations in the quality of formal and informal institutions. Broadly, both formal and informal institutions matter for all firms irrespective of productivity levels and technological gains. Government stability, the country's investment climate, socio-economic conditions, and corruption perception are essential in determining long-run productivity growth and technological changes. However, the role of law and order conditions, political constraints, and competitiveness of the political system/process in determining productivity gains and technological improvements varies by firms’ characteristics.

Country competitiveness and investment allocation in the mining industry: A survey of the literature and new empirical evidence

Mining exploration investment is the primary driver of future mining production. Without exploration investment, it is not possible to sustain metal production. Countries with higher mining competitiveness will tend to attract larger amounts of exploration investments. According to the so-called “traditional” view, a country's geological potential is a crucial determinant of its mining competitiveness. This proposition implies that the geological potential would be the primary driver for allocating exploration investments worldwide. Recently, an “alternative” view of mining competitiveness emerged. According to this hypothesis, a country's investment climate is the primary determinant of its mining competitiveness. However, the empirical evidence supporting the “alternative” view is still scarce.This article aims to analyze the validity of these two competing views. First, we survey the literature on the subject to identify the main determinants of total mining exploration expenditure, which is the leading indicator of mining competitiveness identified in the literature. Second, to analyze the total mining exploration expenditure's determinants, we develop an exponential mean model to test the “alternative” view. We use the Poisson Pseudo-Maximum Likelihood (PPML) method to obtain the parameter estimates, considering our dependent variable's non-linear and skewed nature.Working with a cross-sectional dataset of 72 countries for 2014, we find strong empirical support for the “alternative” view of mining competitiveness. Total budgeted mining exploration expenditure is positively determined by two location factors: countries' geological potential and investment climate. Besides, we analyze the impact of two additional drivers on mining competitiveness: social conflicts and population density. These variables have a statistically significant negative effect on mining competitiveness. Likewise, we estimate regional average elasticities to measure the drivers’ impact on mining competitiveness in North America, Oceania, Europe, Latin America, Asia, and Africa. The effects of these drivers vary enormously across world regions. Finally, we show that the investment climate has a strong elastic impact on attracting mining exploration investments in all the distribution deciles through a quintile analysis. Simultaneously, the geological potential triggers a relevant but still inelastic effect starting in the sixth decile. Our findings can help policymakers and business people to develop strategic plans to attract mining investments and promote economic growth in different jurisdictions.

Theoretical Modeling of the Impact of Political Ties on China's Economic Expansion

Until recently, attracting FDI was officially a key priority of Chinese economic policy, but there has been a gradual shift in the focus on outward foreign direct investment (OFDI) from China. China's OFDI is characterized by a number of features, due to the specifics of the economic model of this country. Thus, the economic expansion of China and other emerging countries requires the development of a new theoretical model that would analyze the characteristics of foreign direct investment in a specific financial and institutional environment. The theoretical model was developed based on the study of E.Helpman focused on the influence of enterprise political relations on OFDI decisions and the relationship of political relations and productivity in management decisions. Several hypotheses follow from the theory: (a) the thresholds for political ties and productivity required for FDI increase as the recipient country's investment climate deteriorates; (b) the growth of political ties and productivity growth increase the likelihood of OFDI.

ЦИФРОВІЗАЦІЯ ПОСЛУГ ВАНТАЖНИХ ПІДПРИЄМСТВ

The process of introduction of digital technologies in the process of cargo transportation were investigated. The process of implementing digital technologies is associated with certain competitive risks: on the one hand, there is a tendency to consolidate the market and the emergence of large multimodal transportation companies, which can lead to the abuse of a dominant position. On the other hand, now the industry can include companies that do not have a transport base, but only have an effective application platform. Regulators need to take into account new trends and develop their own services to obtain timely and reliable information about the state of competition in the market. The introduction of digital technologies leads to the emergence and development of new businesses and changes in competition in existing product markets. The field of freight, which existed before the fourth industrial revolution, also faced the need for strong changes in the digital transformation: changed the companies themselves, internal rules of conduct, ways of interaction between them and with regulators. Measures of economic regulation should take into account new trends in the development of industries and promote (or at least not hinder) further development, especially in key areas of the economy. Such areas include the transport sector, which is strategically important to support to improve the country's investment climate. Digitization, on the one hand, provides additional benefits for large market players, which can create barriers to entry, but on the other hand, it allows players to enter from "neighboring" markets through integrated services. Regulators need to take into account the application of such innovations, adapt legislation to reduce the risk of regulation and apply the experience of foreign countries. The subject of the study is the actual digitization and provision of digitization services in the circle of freight companies, as well as the tools that must be used. The object of research is digitalization services and their relevance today.

Quantifying barriers to decarbonization of the Russian economy: real options analysis of investment risks in low-carbon technologies

ABSTRACTRussia has significant potential for reducing its carbon emissions. However, investment in new low-carbon technologies has significant risks. Ambiguous energy and climate policy in Russia, along with deterioration of the country's investment climate, create investment barriers that are well described in qualitative terms in the literature. This paper attempts to provide a quantitative analysis of these barriers. For this numerical experiment, we apply the RU-TIMES model. Using a real options methodology, we estimate the risk-adjusted cost of capital in the Russian energy sector (including energy production and consumption technologies represented in the TIMES framework) to be approximately 43% (including a risk-free interest rate) and demonstrate the high risk of investment into energy-efficient and low-carbon technologies. Any future low-carbon emissions pathway depends on the ability of the Russian government to reduce climate and energy policy uncertainties, and to reduce financial risks through improvements of the general investment climate.Key policy insightsThe high cost of capital investment into Russian energy production and consumption may prevent the adoption of new energy-efficient and low-carbon technologies.These investment risks, if not addressed, will delay Russia's low-carbon transition for the coming decades.Adopting a clear and unambiguous long-term climate and energy policy is important to reduce these risks and alleviate some of the barriers to the new technologies.The first step could be ratification of the Paris Agreement and adoption of a long-term emission target for the period up to 2050.

Determinants of country competitiveness in attracting mining investments: An empirical analysis

This study contributes to the debate on the competitiveness of countries to attract mining investments. The specific objectives of this work are: to bring empirical support to the alternative view of mining competitiveness, which highlights the key role of country's investment climate; and to propose a methodology, based on cross-country econometric models and the economic theory, to understand how the geological potential and the investment climate interact to define country's mining competitiveness.The research show that long-term mining competitiveness is not solely determined by the geological potential of countries. The models corroborate that both, geological potential and investment climate, are crucial to explain country's attractiveness. Moreover, the results suggest that the relationship of these two variables is not developed individually and additive, but through an interaction of both terms.Finally, the study identifies an “investment climate threshold area” in its final model. Mining competitiveness of countries with low investment climate depend on the interaction between their geological potential and investment climate. On the other hand, countries above this threshold compete for mining funds almost exclusively based on the mineral endowment of their territories. These findings could have relevant consequences in country's strategic decisions for the mining industry.

PROPOSED MODEL FOR THE USE OF CLEAN DEVELOPMENT MECHANISM TO ATTRACT FOREIGN DIRECT INVESTMENT TO EGYPT

The Clean Development Mechanism (CDM) is the Kyoto Protocol mechanism. The Mechanism has two main objectives; to assist Annex I Parties to cost-effectively fulfil part of their emission reduction targets under the Kyoto Protocol, and to help non-Annex I Parties in achieving sustainable development. When the CDM entered into force on 16 February 2005, its implemented projects, in non-Annex 1 developing countries, created certified emission reductions (CERs). So the project participants can sell to Annex I Parties to help them meet their Kyoto Protocol targets, they can also provide complementary benefits to non-Annex I Parties such as new investment, climate friendly technology transfer and know-how, skills development, employment..etc Based on the literature review, none of the studies assessed the clean development mechanism from the point of comparative benchmarking anaylsis between several countries. Most of the studies focused solely on the carbon climate and its economics away from the overall country business climate, competition and investment policies. Attrating foreign direct investments , even for environmental purposes , is an economic activity and there is a need to assess and test how to integrate the promotional activities for environmental projects into the country investment promotion strategy. This study was conducted in order to propose a model and action plan to benefit from the clean development mechanism in order to attract foreign direct investment to Egypt. To be able to gather the necessary data, the researcher utilized descriptive method using both qualitative and quantitative approaches. Herein the chosen responded governmental officials were selected from the assigned Egyptian ministries responsible for investment and environmental affairs. Structured interviews was the research method used for data gathering to evaluate the challenges that facing the inclusion of clean development mechanism within Egypt’s investment opportunities, and to reach out the potential sector and targeted foreign countries to invest in Egypt’s CDM projects. The compiled values and statistical analysis utilized the official data released from the UNFCCC secretariat along with the official investment data of Egyptian General Authority for Investments and Free Zones and the official reports of related global indicators. The results of the study may help the decesion maker to integrate more the environmental projects into the investment policies. Despite the uncertainity that might shape the future of CDM, the researcher would like to stress on the need to capitalize on CDM benfits and to learn from the other peer developing countries experience. The proposed model may be used as a catalyst towards more integration of the CDM framework into the country investment climate and doing business activities.

IDENTIFYING CONSTRAINTS THAT REDUCE TOTAL FACTOR PRODUCTIVITY IN NIGERIA

ABSTRACT Nigeria's investment climate is poor. This paper estimates how the poor investment climate affects productivity in the country. The empirical estimates suggest if Nigeria's investment climate was as favorable in every way as the median developing country's investment climate, TFP would be about 40 percent higher. If Nigeria's investment climate was as good as in the best performing developing countries—that is, countries where the investment climate is better than in 80 percent of developing countries—TFP would be about 60 percent higher. The biggest constraints are high crime, poor infrastructure, and limited access to credit. Keywords Nigeria; Enterprise Surveys; Total Factor Productivity; Investment Climate.

Community development requirements in mining laws

Since the mid-1980s, 32 countries around the world have adopted community development requirements into their mining laws, while nine countries are in the midst of doing so. This new public regulation approach to addressing mining's impact goes beyond mitigating the negative effect of mining on local communities (such as through compensation arrangements and environmental laws), to requiring firms and/or states to ensure that mining translates into real, positive social and economic gains for mining-affected communities, thereby redressing the inequitable distribution of mining's costs and benefits. I address the question of cross-national variation in the adoption of these laws through a combination of statistical analysis and a case study of regulatory reform in Sierra Leone. I find that strong regional, organizational, and economic pressures provide material and normative incentives for states to adopt these laws, with global norms diffusing from the international to the domestic level through international institutions, actors, and financial flows. Countries with community development in mining laws are likely to influence neighboring states to adopt similar laws, while soft law initiatives like the Extractive Industries Transparency Initiative exert normative influences on member states to adopt new laws that benefit mining-affected local communities. States further adopt the laws to attract foreign investment into their mining sectors, as community development in mining laws serve as a signal to the international community about the quality of a country's investment climate – in particular, the security of the investment environment.

Influence of the Higher Education on the Investment Climate

The investment climate is influenced by different factors: political, economic, social, juridical, ecological, etc. The present article represents the analysis of the higher education influence on the country's investment climate, expressed by the rank of the indicator of investment attractiveness by materials of “Doing Business”. The authors of the article suppose that a greater number of students, acquiring the higher education favours the investment climate of the country. This hypothesis was proved using correlation method on the basis of Eurostat data by countries of the Central-Eastern Europe.

Using exploration expenditures to assess the climate for mineral investment

Countries that rely on private investors to find and exploit their mineral resources need reliable indicators of their investment attractiveness. This study explores the use of exploration expenditures for this purpose, focusing primarily on Chile. It finds that exploration expenditures can provide useful insights into both the level and trends in investment attractiveness for individual mineral producing countries. However, for various reasons, it is a country's share of grassroots exploration expenditures for specific metals, rather than its share of total world exploration, that most directly and immediately reflects investment climate. Over the current decade, Chile's shares of world grassroots exploration for gold and (more recently and more modestly) for base metals have fallen, suggesting a deterioration in the country's investment climate for these mineral commodities. The declines, however, are less dramatic than the country's falling share of total world exploration suggests. The study concludes by briefly examining the levels and trends in investment climate for the more important mining countries. Among other trends it finds that Canada and Australia continue to enjoy a high level of attractiveness despite the efforts of many developing countries in recent years to increase private investment in their mineral sectors.

Nigeria's Changing Investment Climate: The Private Sector Perspective

This paper chronicles the progressive policy changes that started with the Structural Adjustment Programme (SAP), culminating in the broad reform strategies of recent years, and traces their impact on the country's investment climate. Evidently, active implementation of reforms since 2001 has resulted in modest positive changes in the ICT and financial sectors where the investment climate has improved the most; however poor infrastructure remains a major impediment to reaping the rewards of the gains made in macroeconomic management. NESG Economic Indicators Vol. 13 (2) 2007: pp. 11-18

Does lower income inequality improve a Country's investment climate?

Does lower income inequality improve a Country's investment climate?

Political Risk and Foreign Exchange Rates: an Efficient-Market Approach

This paper examines the reaction of the foreign exchange market to the announcement of changes in the business environment of a country. Our results suggest that sampled political risk news conveys important information about a country's investment climate and causes its currency's exchange rate to vary. It appears, however, that the reaction of the foreign exchange market is more dramatic for unfavorable events than for favorable events. The evidence presented is also consistent with the hypothesis that the foreign exchange market is efficient in interpreting the type of event considered in this study.