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Abstract

Content

Introduction

1. Theme urgency

The main condition for release of Ukrainian economy from the financial and economic crisis is to increase the competitiveness of enterprises, which is impossible without updating the outdated capital stock and innovation in the industry. These activities require the involvement of a significant amount of investment, lack of which is observed today in most countries, Ukraine is no exception to this majority. At the present stage of development for the restructuring of the state's economy requires a 320 billion UAH investments annually. In 2010 this figure amounted to 155.1 billion UAH. That less than the required volume of more than two times. Also, note that in the past 10 years, the volume of investments into economy of Ukraine has not exceeded 250 billion UAH, that is, the number of available resources is very insufficient for the development of the state. This makes it important to increase the issue of attracting foreign investments, which are the choice of the recipient country are paying considerable attention to its positioning in the international rankings, because this figure is the result of the interaction of all factors of the economy and, consequently, the activities of enterprises. In the period from 2000 to 2010 observed annual increase in the degree of depreciation of capital stock, which leads to lower production volumes and, consequently, the profitability of enterprises. Since the main parameter for the investor in the implementation of investment is exactly the profitability of a business entity or an individual project, such negative trends reduce the level of investment attractiveness of enterprises and the state as a whole. Based on the above–mentioned negative trends in the state's economy, raising the question becomes more urgent the investment attractiveness of domestic enterprises, enabling them to attract the necessary investment resources to stabilize the operation and further development.

2. Goal and tasks of the research

The aim of this study is the further development of theoretical positions and methodological approaches for evaluating and improving the investment attractiveness of enterprises. Main tasks of the research:

  1. Analysis of Ukraine's place in international rankings, which are critical for potential investors.
  2. Review and theoretical generalization of existing methods for evaluating the investment attractiveness of the enterprise.
  3. Deepening the methodological approaches to the analysis of investment attractiveness of the company.
  4. Analysis of the factors and the reserves for increasing the investment attractiveness, improvement of their classification.
  5. Find ways to increase the investment attractiveness of enterprises, development of recommendations for their use.

Research object: the process of raising the investment attractiveness of enterprises.

Research subject: theoretical and methodological basis, practical aspects of evaluating and improving the level of PPI.

As part of the master plan to get the actual scientific results in the following areas:

  1. Analysis of the theoretical assumptions of the definition of investment attractiveness domestic and foreign scientists.
  2. Refinement of differences between the terms investment attractiveness and investment climate.
  3. Analysis of the importance of positioning the country in the international rankings for foreign investors.
  4. Deepening the methodological approaches to the analysis of investment attractiveness.
  5. Improving the classification of the factors that affect the investment attractiveness of the company.
  6. Analysis of ways to increase the investment attractiveness of enterprises, development of recommendations for their use.

3. The first section – Theoretical Foundations of investment attractiveness of enterprises

In this section, a generalization of theoretical assumptions made about the state of Ukraine's investment attractiveness in the international rating assessments, which have a significant impact on the investor's decision when choosing the recipient country, analyzed the definition of investment attractiveness and investment climate, identified the factors that negatively affect the investment attractiveness of Ukraine.

It was found that among national scientists there is no single approach to the definition of investment attractiveness. Most of them identify the investment attractiveness of a country or region with the definition investment climate.

According to the results of this analysis we can say that the investment climate is an integral part of the investment attractiveness of enterprises, regions and country. Consequently, these concepts are very closely related, that is characterized by the investment attractiveness of all the factors that influence the investment decision an investor, including investment climate.

As a result, found that the Ukraine, according to investors has unfavorable conditions for the realization of investment projects, and requires a radical reform of the national economy. In particular, priority activities include improving the efficiency of public administrations, which will lead to increased investor confidence in the Ukraine.

Analyzed the Investment reform in Ukraine, which was signed June 6, 2011. The overall objective of this reform is the involvement of foreign direct investment in Ukraine's economy, the formation of a positive investment image of Ukraine in the world. That is, the Investment reform – a set of mechanisms and institutions projects summary, which are combined with each other and are aimed at increasing investment in the national economy. To achieve this goal in the Investment reform delivered the following key tasks:

Achieving these tasks will provide the following results:

  1. The increase in investment to 80 billion USD over the next three years.
  2. Improvement of Ukraine's sovereign ratings: Doing Business World Bank to 100 with 145 seats, Global Competitiveness Report World Economic Forum from 82 to 50 seats.
  3. Reducing the annual outflow of foreign direct investment from 15% to 10%.

According to the analysis of Investment reform in Ukraine must be said that it contains the experience of developed countries in attracting foreign direct investment and adapted to the Ukrainian economy. The reform considers key questions relating to investment and ensures development in all sectors of the economy that will not only reach the pre–crisis level, but also to ensure continued growth of macroeconomic indicators.

The analysis of the provisions of the methodical assessment of investment attractiveness of enterprises, determines their strengths and weaknesses and the main paths of development. Most financial analysts to assess the investment attractiveness uses the expert–rating approach, which is often combined with the economic–mathematical methods and elements of the parametric analysis. But these directions of analysis can only provide an internal decision – the need for investment, the definition of types of investment and techniques to attract them. For investors, these indicators are inadequate as methods for determining the appropriateness of investing in the company because they will be different due to the fact that investors are interested in income, profits and expenses. Lenders are more interested in the solvency, liquidity and stability.

We can say that there is the problem of choosing the method of assessment of investment attractiveness, as each of the subjects of the investment process of pursuing their own interests and therefore the method of determination of attractiveness must be specific to take into account those interests. It is established that at present there are many approaches to assessing the investment attractiveness of the enterprise. Thanks to the work of economists, these methods are constantly adjusted and improved. Each has its advantages and disadvantages. The presence of disadvantages stimulated the emergence of new, more universal formulas, development of other methods of calculation and, consequently, the obtaining of a universal formula in general, what is relevant in today's market conditions.

4. The second section – Development of provisions for evaluating and improving the investment attractiveness

Found that the investment attractiveness of the state plays a major role for foreign investors and because the investment is carried at a particular enterprise (project), the importance gets their investment attractiveness. That is, the investor in choosing the object of investment passes the stages which is presented in fig. 1.

Stages of the choice of the investment object

Figure 1 – Stages of the choice of the investment object
(animation: 5 frames, 5 repetitions, 35 kilobytes)

In the current economic conditions, which are characterized by difficult economic conditions, investment attractiveness enterprises is low, so the important aspect is to find and use factors and the reserves of its increase.

On this basis, it should be noted that the factors increasing the investment attractiveness – is the driving force, under the influence of which varies the level of investment attractiveness of the enterprise. IAE is defined by a complex of different factors, the list and the importance of which can change depending on:

  1. The objectives of investors;
  2. The production and technical features of the enterprise in which funds are invested;
  3. The economic development of the enterprise in the present tense, past and expected growth;
  4. A complex of external factors, including current legislation, the environmental situation, the level of competition [3].

In turn, the reserves of growth of investment attractiveness – is not used opportunities to increase the investment attractiveness. Therefore, the factors are the broader concept that includes the reasons for the change of investment attractiveness in the past, the present tense, and causes that will increase it in the future, that is reserves. What is a factor, and that – reserve depends on each individual enterprise [4].

It is established that there is no clear classification of the factors increasing the investment attractiveness of the enterprise. On the basis of the material studied proposed a list of factors that most significantly affect the investment attractiveness of enterprises in terms of the foreign investor:

  1. Profitability (profit) activities;
  2. The level of financial stability of the enterprise;
  3. Prospects for further development of the enterprise;
  4. Qualifications of staff;
  5. The level of expenditure on environmental measures;
  6. Legislative regulation of the industry in which the company operates.

At this stage of the work carried out further studies of factors and reserves increase the investment attractiveness of enterprises and the directions of their use. Based on the current developments of domestic and foreign scientists carried out the development of their own classification, which corresponds to the modern requirements of investment. This classification takes into account the factors that are important for foreign investors, branch of industry in which the enterprise operates, the legislative and tax regulation of investment activities.

Considered the further development of methodologies for assessing the investment attractiveness of the company, because on the basis of the material studied set that to date there are many approaches to assessing the investment attractiveness. Thanks to the work of economists, these methods are constantly adjusted and improved. Each has its advantages and disadvantages. The presence of defects stimulates the emergence of new, more universal formulas, development of other methods of calculation and as a consequence, breeding more universal method that is relevant in today's market conditions. Industry specialization of enterprises causes an individual approach to the analysis of each company, so necessary is to develop a method for assessing the attractiveness of that would characterize it at a general level.

Thus, each method of analysis of investment attractiveness of enterprises require adjustments and new approaches. With the changing economic environment is changing and the meaning of various indicators, so there is a need for more specific decoding and the method of determining the performance indicators of the enterprise that affect its investment attractiveness. Therefore on the basis of the analyzed during the writing of methodological materials, proposes methodology, which takes into account these requirements.

5. The third section – Guidelines for improving the investment attractiveness

This section discusses the reserves for increasing the efficiency of the enterprise. Based on the analysis carries out rationale for the selection of these reserves for the calculation of values ​​of the index of investment attractiveness of the enterprise. Establishing its relationships with the general results of the company operations, its industry sector, etc. At this stage of writing the master's thesis summarizes the material studied and the development of provisions for reserves for raising the justification of the choice of reserves of investment attractiveness.

Calculated indicators of investment attractiveness of enterprises by different methods on the basis of the data collection process. The analysis of the results and draw appropriate conclusions that characterize each of the obtained values, their relationship and outcomes assessment of the level of investment attractiveness of enterprises.

According to the analysis of the material studied and the results obtained calculating the level of investment attractiveness was proposed methodical guidelines for assessing the impact of projects on this indicator, developed ways to improves the results of the project and the enterprise as a whole to increase its attractiveness to foreign investors. Developed a forecast of further development of the enterprise.

Conclusion

During the period of instability and crisis in the Ukrainian economy the enterprises have felt the need for investment in order to stabilize their condition and to provide opportunities for further development. Given the limited of its own investment resources becomes more urgent issue of attracting foreign investors. However, the choice of the recipient country and, accordingly, a certain enterprise is significantly affected by the investment attractiveness of the state, as the macro–level, where economic activity is carried out. In this regard:

  1. Found that in international assessments of investment attractiveness of Ukraine is relatively low position, which makes it unattractive to foreign investors. This is due primarily to the political and economic instability, low level of protection for foreign investors, a low level of economic freedom, etc. Particularly acute is the problem in terms of lack of investment (at the needs of 120 billion UAH, the maximum volume reached 233.1 billion UAH). Therefore, increasing the rating of Ukraine is a very important goal, especially in today's conditions, since the attraction of foreign investors will favor a more rapid exit from the state of economic crisis, the emergence of new jobs, improve living standards, increase the competitiveness of Ukrainian products on the market. In the present context there is heightened interest of foreign investors to Ukrainian enterprises, but interest may be converted into cash only if a sufficient rating investment attractiveness, reliability and transparency of the involved resources, the presence of an effective legislature framework, because the investment attractiveness of the macro and micro levels are very closely related.
  2. In the scientific papers of domestic researchers reviewed many methods to determine the investment attractiveness of the enterprise. Each of them has certain positive and negative traits. The positive are: a low complexity of the calculations, all indicators of intelligence for investors, the ability to use to assess the attractiveness of various industries. However, based on the positive, include some negative features – not all methods can be quite accurate to characterize the economic situation of enterprises, which could lead to incorrect management decisions, and even in the generic methods are factors that may give contradictory characteristics of investment attractiveness. This is due to the fact that some methods can not be fully utilized in connection with the modern conditions of economic development, organizational and legal form, industry affiliation. Asked to identify those indicators of enterprises in different sectors, which will be universal, that is identical to characterize the economic situation of the company. This, in turn, will determine the strengths and weaknesses of the company, and ways to overcome them.
  3. With regard to the factors and increase the investment attractiveness of reserves, we should say that each particular enterprise depends on a factor, and that – reserve. Proper use will increase the investment attractiveness of Ukraine. Proposed list of factors and reserves, which is due to the realities of economic activities, and includes economic, labor and information factors and reserves. You can also say that the directions for businesses to increase their attractiveness to foreign investors is improvement organizational structures to attract highly qualified professionals, upgrading or replacement of obsolete equipment, innovative activity. Such events will certainly require resources, but these costs in attracting foreign investments will be completely covered and provides a sustainable development of enterprises, industries and the economy as a whole.
  4. Designed a classification of factors and reserves to increase investment attractiveness of the company, which takes into account important factors for foreign investors, industry affiliation of business entities, legal and tax regulation of its activity. The necessity of making the existing methods for assessing certain adjustments that will allow it to assess the level of a more general level, according to current economic conditions. Developed guidelines for evaluation of investment projects that are implemented at the enterprise and how to improve their results.

References

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Note!
At the time of writing the abstract master's work is not yet complete. Date of completion – December 2012. The full version of the abstract and the diploma can be obtained from the author or the head after the deadline.