Sirenko N. M., Doctor of Economic Sciences, Professor, the Head of the Department of Finance, Banking and Insurance, Mykolayiv National Agrarian University, Mykolayiv, Ukraine

ORCID ID: 0000-0003-1660-1073
e-mail: sirenko@mnau.edu.ua 

Mikulak K. A., Assistant of the Department of Finance, Banking and Insurance, Mykolayiv National Agrarian University, Mykolayiv, Ukraine

ORCID ID: 0000-0001-8317-0360
e-mail: mikulyak@mnau.edu.ua

Ihnatenko Zh. V., Teacher of the Foreign Languages Department, Mykolayiv National Agrarian University, Mykolayiv, Ukraine

e-mail: ignatenko@mnau.edu.ua

Financial Mechanisms for the Development of the Agrarian Sector in Market Environment

Abstract. Introduction. The financial mechanisms of agrarian sector development, which are necessary in creating a solid financial basis for its functioning not only in domestic, but also in foreign markets, are considered. Expenditure fluctuations for the agrarian sector for the period of 2013-2018 are presented, the main expenditures on budget programs of the agro-industrial development, which include scientific research, financial support of agricultural producers, livestock support, financial support for the development of farms, and the costs of the Agrarian Fund are analyzed. The share of developed investments for the period of 2012-2018 and the indices of capital investments in agriculture, forestry and fish farming have been explored. The dynamics of direct investment (share capital) inflow into the economy of Ukraine depending on types of economic activity is shown and other financial mechanisms of development of the agrarian sector are reflected.

In present conditions, the strategy of developing agricultural enterprises is largely dependenon the ability to adapt to changing conditions of the external market environment and the sensitivity to introducing various types of innovations and achievements in scientific and technological progress. The active globalization processes that involve the formation of world commodity and financial markets and the integration of the national economy into the global economic system lead to a significant increase in the role of foreign economic relations, which increases their importance for the development of the agrarian sector of the economy, which largely depends on the proper participation of the state in its formation and sales.

Purpose. To analyze the theoretical and methodological principles of the agrarian sector financial regulation mechanism in the conditions of Ukraine’s integration into the world economic space, thus strengthening the role of foreign economic relations.

Results. The financial mechanisms of the development of the agrarian sector, including instruments of fiscal, tax, customs, currency, pricing and investment policy in the form of incentives or restrictions are considered. The main expenses for the budget programs for the development of the agro-industrial complex were analyzed, and the largest share was also found in the structure of expenditures on budget programs for the development of the agricultural complex. The share of investments in January-June 2018 was investigated, and it was found that their relative index is 13.0% versus 16.1% of the same period last year. As of January-June 2018, 26.9 billion UAH were used in agriculture, forestry and fishing. The largest share in total investment in agriculture, forestry and fishing was in Kyiv (10.9%), Vinnytsia (8.9%), Dnipropetrovsk (6.8%) and Mykolayiv (3.7%). The Transcarpathian region was in last place with an index of 0.2%.

Conclusions. For the purpose of effective development of the agrarian sector of the economy, it is necessary to take into account the specifics of agricultural production, to apply specialized regulation mechanisms to increase the profitability of agricultural enterprises, to increase state budget revenues and to ensure the competitiveness of agricultural products in the domestic and foreign markets with the support of small commodity producers and the creation of credit cooperatives, specialized agriculture, bank support for the sector, farm income stabilization, state guarantees for insurance payments, and futures instruments in support of rural development support programs.

Keywords: agrarian sector; agricultural receipts; agro-industrial complex; state budget expenditures; capital investments; lending; financial instruments; financial mechanism.

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