National Financial Security Research Articles

Thinking about the Return of Gold and Silver and other Minerals to Monetary Attributes under the Condition of Financial Changes with the Superimposition of the COVID-19

This paper analyzes the history of currency development from physical currency, metal currency, paper currency to electronic currency, analyzes the evolution of the international currency settlement system, its pros and cons, and the global financial changes caused by the epidemic;analyzes the problem as to how the U.S. dollar is bound to gold and oil, i.e., the process of international hegemonic currency, and analyzes the overall impact of the outbreak of the epidemic in 2020 on the economy, the over-issue of the U.S. dollar, the continued weakening of the U.S. dollar index, and the strengthening of the hedging effect of gold and silver. Under this change, global precious metal mergers and acquisitions have increased, countries have increased their gold reserves and made exploratory promotion of a new currency system tied to gold. From the perspective of safeguarding national financial security and the internationalization of RMB, this paper puts forward suggestions for increasing the reserves of gold and silver at home and abroad, raising government reserves and private reserves in the medium and long term, and speeding up the launch of RMB internationalized gold and silver anchors. © 2021, Science Press. All right reserved.

Концептуальні засади забезпечення фінансової безпеки акціонерних товариств в Україні

The article is aimed at defining the conceptual principles for the development of a system for ensuring the financial security of joint stock companies (JSC) in Ukraine, which will contribute to increasing the level of capitalization and security of both listing companies and the stock market as a whole. The theoretical and methodological basis are fundamental provisions of both economic and institutional theory, security theory, system analysis using such general scientific methods of cognition of economic phenomena and processes as theoretical generalization, synthesis, induction, and deduction. The article substantiates the theoretical and methodological bases for the development of conceptual principles of the system of ensuring the financial security of joint stock companies in Ukraine. In order to research the implementation of the State’s approaches to ensuring the national financial security and the capital markets development, strategic documents in Ukraine were analyzed and an inconsistency between target indicators and formulations of strategic goals were determined. A complex of hypotheses is formed and proved, approaches and principles of the conception of forming a system for ensuring the financial security of joint stock companies are substantiated, taking into account the peculiarities of the State regulation of the financial security sphere. The developed conception is based on a new scientific approach to searching ways to improve the financial security system of joint stock companies in Ukraine. It can be concluded that implementation of the proposed conceptual bases will allow the achievement of the expected results, strengthen the financial security of JSC, make them more resistant against system crises, and create a stable basis for their long-term development.

Development Finance: A Financing Platform Between the Government and the Market

The core of development finance with Chinese characteristics is that it is a “bridge” between the government and the market. Development finance addresses the phenomenon of “market failure” due to information asymmetry and alleviates the problem of “government failure” due to the inefficiency of fiscal subsidies and other funds through government intervention in financial markets. Meanwhile, it integrates the advantages of commercial finance and traditional policy-based finance. It is a form of finance that was introduced in response to institutional backwardness and market failure and in order to safeguard national financial security and enhance economic competitiveness. The core mechanism of development finance is to build a government credit system through cooperation between policy banks and governments and by relying on government-organized credit enhancement, and to form a financing mechanism consisting of “project selection by the government, development finance incubation, and the realization of market outlets”. Development finance combines project construction with market building, makes initiative on the part of the government the focus of the market-oriented operation of development banks, utilizes national credit, and regulates market failure and promotes balanced economic development through reasonable arrangements for credit volumes and structures. 

Шляхи відновлення діяльності банків у контексті національної фінансової безпеки

Шляхи відновлення діяльності банків у контексті національної фінансової безпеки

Do bitcoin ao “renmimbi digital”: soberania monetária, segurança financeira e a possível nova ordem financeira centrada na China

O bitcoin foi lançado em 2009 com a pretensão de ser moeda privada, não institucional e livre dos arbítrios governamentais. Não teve êxito como tal, mas mostrou-se um meio para transferir direitos fora da vigilância e do controle das autoridades nacionais e internacionais. Por isso, o governo da China, extremamente cioso da sua soberania monetária, o considerou uma ameaça à segurança financeira, reprimindo o seu uso. Apesar disso, identificou nas tecnologias do bitcoin uma oportunidade para criar uma moeda digital governamental. O resultado foi a instituição do “renmimbi digital”, com o qual pretende maior rapidez e eficácia na execução das políticas internas, controlar essa nova modalidade de transações comerciais e, se possível, erguer as bases de uma nova ordem financeira centrada na China.

FINANCIAL SECURITY IN THE SELECTED COUNTRIES AND THE LESSONS FOR VIETNAM

Financial security is an issue of concern in many countries as it is responsible for ensuring the financial system is stable, safe and strong. Stemming from this provision, the authors of this article describe the current financial situation in Vietnam and analyze a number of reasons as well as experiences in terms of financial security of several other countries around the world. Based on the aforementioned financial security experiences, lessons are to be drawn for the authorities and policy makers of Vietnam that are responsible for improving the efficiency of national financial security.

A strategy of insurance market development in conditions of latent military conflict in Ukraine

One of the basic preconditions of overcoming economic consequences of the military conflict in the East of Ukraine is a developed financial sector, an integral part of which is insurance market. Considering existence of internal problems of the industry’s development, that are strengthened by influence of military-political instability, the domestic insurance companies cannot fully achieve effective redistribution of risks and capital, as well as provide stability of economic system in the whole. This research is directed to the theoretical justification of a perspective strategy of the insurance market’s development in conditions of latent military conflict as well as to offer the appropriate practical recommendations for Ukraine. In order to achieve the set goal, there was substantiated the necessity of a complex application of the general scientific and special methods of cognition, namely methods of abstraction, analysis, synthesis, grouping, analogy and comparison, as well as the economic-mathematical methods. Basing on the official data on an insurance market’s development in Ukraine, there was revealed a tendency to worsening of its abilities in provision of national financial security, that is confirmed by shortening of volumes of insurance premiums and formed insurance reserves, as well as reduction of ratio of the insurance premiums to GDP and number of population in Ukraine during the last years. Moreover, with the help of instruments of correlation-regressive analysis, there was revealed a dependence of the level of the insurance market’s financial potential usage on the level of insurance penetration in Ukraine in the years 2002-2019. We define economic problems of latent military conflict, which can be solved with the help of insurance market, in particular, a slow economic growth, conditioned by a high level of credit risks, the unresolved issues of responsibilities’ fulfillment by insurance companies in conditions of military conflict and after it, as well as a rapid increase of financial needs of healthcare system. In accordance to this, there were given recommendations concerning their solution, which foresee a priority in medical insurance development, widening of insurance conditions and list of insurance risks, connected with bank crediting, as well as development of new insurance products, considering an influence of a military conflict’s factor. In conditions of overcoming the consequences of military conflict, the transformation of insurance market’s role appears, which is connected with increase of risks level and slowing down of financial resources movement. The proposals, formed as the result of this research, can be useful to develop the perspective plans of Ukrainian insurance market’s development. At the same time, the coordination of actions of the state regulators, unions of market’s participants, owners and management of insurers, as well as consumers of insurance services, are needed.

Crude Oil Prices Forecasting: An Approach of Using CEEMDAN-Based Multi-Layer Gated Recurrent Unit Networks

Accurate prediction of crude oil prices is meaningful for reducing firm risks, stabilizing commodity prices and maintaining national financial security. Wrong crude oil price forecasts can bring huge losses to governments, enterprises, investors and even cause economic and social instability. Many classic econometrics and computational approaches show good performance for the ordinary time series prediction tasks, but not satisfactory in crude oil price predictions. They ignore the characteristics of non-linearity and non-stationarity of crude oil prices data, which hinder an accurate prediction and eventually lead to poor accuracy or the wrong result. Empirical mode decomposition (EMD) and ensemble EMD (EEMD) solve the problems of non-stationary time series forecasting, but they also generate new problems of mode mixing and reconstruction errors. We propose a hybrid method that is combination of the complete ensemble empirical mode decomposition with adaptive noise (CEEMDAN) and multi-layer gated recurrent unit (ML-GRU) neural network to solve the abovementioned issues. This not only deals with the issue of mode mixing effectively, but also makes the reconstruction error of data close to zero. Multi-layer GRU has an excellent ability of nonlinear data-fitting. The experimental results of real WTI crude oil dataset show that the proposed approach perform better in crude oil prices forecasts than some state-of-the-art models.

ОСНОВНІ МЕХАНІЗМИ РЕАЛІЗАЦІЇ ГРОШОВО-КРЕДИТНОЇ ПОЛІТИКИ ТА ЇХ ОСОБЛИВОСТІ

This scientific article is devoted to the analysis of theoretical principles, legislation, scientific positions on improving the priorities and mechanisms of monetary policy in the national financial security system. The purpose of the study is to strengthen the process of national financial security. The subject of the study is to identify key points in the national financial security system and the implementation of theoretical and methodological principles, as well as scientific and practical recommendations for the implementation of mechanisms to improve monetary policy. The conceptual provisions of monetary policy and its provisions in the national system of economic and financial security are formulated. The authors substantiate that today the financial systems of individual countries, as well as other sectors of the economy, are improving and progressing in the context of globalization, the spread of IT technologies and general computerization; Electronic cryptocurrency replaces traditional money issued by the state. It is substantiated that over the last year the cryptocurrency has won the interest not only of people, but of entire states, which have begun to actively introduce this currency into their daily circulation. This means of payment is already gaining momentum in use in developed countries. The focus is on the analysis of the concept of "blockchain". The article states that today Ukraine is among the ten countries in the world in the number of bitcoin nodes in the global bitcoin network, the leader in the number of bitcoin businessmen. The study summarizes the methods, tools and means of state regulation in the monetary sphere in order to strengthen the financial security of the state. The conceptual basis for the formation and implementation of monetary policy has been developed. The authors conclude that the strategic vector of movement for Ukraine is the need to adopt a specialized legislative act "On cryptocurrency circulation in Ukraine" in order to create conditions for the introduction of network segmentation technologies, which in the long run will reduce globalization and further develop cryptocurrency market infrastructure.

PROCEDURAL AND INSTITUTIONAL ASPECTS OF FINANCIAL SECURITY IN UKRAINE

The article analyzes procedural and institutional, regulatory and legal-theoretic problems of ensuring financial security in Ukraine on the basis of the analysis of theoretical achievements of domestic scientists and empirical base. The current state of scientific research in the field of procedural and institutional aspects of financial security of Ukraine has been traced, and our own vision of the system of economic security and system of financial security has been offered. The concept of "financial security" is studied and the necessity of its use generally and properly is substantiated. While characterizing regulatory support of certain elements of the financial security of Ukraine, its shortcomings are pointed out and the adoption of a number of laws and regulations that would contribute to the improvement of the legal control of the specified sphere has been proved. In addition, proposals for amendments to the current legislation have been introduced and need for a number of new regulatory legal acts have been justified. The system of bodies of counteraction to threats to financial security is paid attention to, the necessity of improvement of their work, establishing cooperation, implementation of new forms and methods that would meet the challenges of today is proved. Reform steps in the area of financial security in recent years and attempts to create the National Financial Security Bureau are analyzed. The need for the establishment of the unified, independent from the executive power, government agency to address the issues of financial security, is emphasized. The research has led to the conclusion that the financial security is a major component of national security indispensable in solving any of the challenges facing the state. It is noted that the recent financial security of Ukraine is influenced by a number of external and internal threats: financial crises, geopolitical situation, influence of activities of international organizations, inflationary processes, corruption, instability of the legal system, etc. On this basis, the financial security of Ukraine should be ensured by means of sound state policy in accordance with the established principles, concepts, strategies and programs in the financial sphere, and the establishment of appropriate government agencies.

The informal economy as a destructor of the national financial security

The informal economy as a destructor of the national financial security

The Analysis of the Financial Security of Russia: Current Trends, Challenges, Threats

Financial security is one of the main factors of competitive and sustainable development of any country in the world. In addition, financial security is an integral part of national security of any state and, from the practical point of view, it represents a special condition of the national financial system described by the system of special criteria. Current confrontation on the global stage sets the particularly acute task of improving national financial security and the security of the entire economy in the face of modern threats manifesting in sanctions. In order to understand which sectors of the economy are the most vulnerable, it is necessary to compute special indicators that can characterize the state of the national financial security. The system of criteria for assessing the national financial security developed within the framework of the methodology proposed by Russian scientists- economists V.K. Senchagov, G.N. Maltsev, I.G. Maltseva is the most complete and widely used in Russia and includes the in-depth system of 40 indicators grouped into 5 systemic blocks. This system of indicators served as a methodological basis of the authors’ calculations in the article. In addition, this study analyzed the main problems of the Russian economy identified after the calculations, as well as compared them with those identified in the official forecasts and development strategies.

Inter-Vulnerability of Financial Institutions and Households in the System of National Financial Security Assessment

Inter-Vulnerability of Financial Institutions and Households in the System of National Financial Security Assessment

Introduce CRS Standards for the Automatic Exchange of Tax Information into International Practice and Improve the Legal Regime on Controlled Foreign Companies

Countering crime in taxation area is one of the crucial tasks since this type of offence encroaches upon the economic principles and the power of the state, promotes development of corruption ties and therefore is deemed to be among the most dangerous perils to the national financial security. The Tax Policy Centre of the Organization for Economic Co-operation and Development has launched a system, within the framework of the Automatic Exchange Portal, for disclosure of schemes aimed at circumventing the single standard (CRS) for automatic exchange of information on taxpayers’ accounts. The law on the place of residence (location) is applicable in terms of international private law pertaining to OECD information exchange rules. The legislation on controlled foreign companies proved to be the legislators’ response, in most of the developed countries, to minimization of taxation in offshore zones, having the purpose to prevent tax evasion through offshore companies established in jurisdictions with minimal taxation. On 27.12.2017, within the framework of the course for counteracting offshore structures and obtaining unreasonable tax benefits, certain amendments were introduced in Federal Law No. 376-ФЗ, with specification of conditions for classifying a foreign company as a controlled foreign company; setting the criteria for recognizing individuals and organizations to be controlling entities; introducing a procedure for taxation and exemption of controlled foreign company’s profit from taxation. In this regard, it is necessary to draft a number of laws aimed at development of mechanisms for return of capital to the Russian jurisdiction and regulation of legal norms intending to release business representatives from paying the 13-percent tax in the event of termination of their business abroad.

National Sovereign Credit Ratings, Cross-nation Contagion and Stock Market Responses: Evidence from the Event Study of 48 Economies

A grasp of the market impact and transmission mechanism of sovereign credit rating changes is of great significance to by investors, the maintenance of national financial security, and countermeasures taken by governments. This paper uses event study and a total sample of rating events of 48 economies, including China, and daily stock returns data from 1990 to 2013 to empirically study the impact of sovereign credit ratings changes on the stock market and its transmission channels.It comes to the following conclusions:firstly, sovereign credit ratings downgrading generates significantly negative abnormal returns on the stock market, but abnormal returns resulting from sovereign credit ratings upgrading are not significant; secondly, the stock market can predict the event of sovereign credit ratings downgrading in advance, but cannot predict the event of sovereign credit ratings upgrading; thirdly, monsoon effect provides the explanation of market contagion of ratings adjustment to some extent; fourthly, related variables of net contagion effect are basically not significant, illustrating thatmarket contagion of ratings events should have an economic base and is not caused by psychological expectations (this kind of non-fundamental factors) of investors; fifthly, spillover effect can better explain market contagion of sovereign credit ratings, and is the main channel of the effect of changes in sovereign credit ratings on stock market and contagion.The conclusions deepen the understanding of the effect of changes in sovereign credit ratings on stock market and its different transmission channels, and also provide a useful inspiration for China to prevent from its own sovereign credit ratings change risk.

Developing a system of indicators of national financial security

Developing a system of indicators of national financial security