| Economics | Socium | Environment |
|---|---|---|
Environmental Economics and Sustainable Development, 2019, 6 (25): 20-26
DOI: https://doi.org/10.37100/2616-7689/2019/6(25)/3
UDC 338.24(477)
JEL CLASSIFICATION: H54; R51
Mariia Ilina
Dr. Sci. (Econ.), Senior Researcher,
Leading Researcher of the Department of Problems of
Land and Forest Resources Economy of the
Public Institution "Institute of Environmental Economics and
Sustainable Development of the National Academy of Sciences of Ukraine"
ORCID:https://orcid.org/0000-0002-5555-1614
Yulia Shpyliova
PhD (Econ.), Senior Researcher,
Senior Researcher of the Department of Problems of
Land and Forest Resources Economy of the Public Institution
“Institute of Environmental Economics and Sustainable Development of the
National Academy of Sciences of Ukraine”;
ORCID: https://orcid.org/0000-0003-0220-0041
PUBLIC-PRIVATE PARTNERSHIP AS THE MECHANISM OF THE RURAL TERRITORIES’ DEVELOPMENT
Abstract: Public-private partnership is the instrument of cooperation between state and business. It has many forms and functions but the only purpose to improve welfare of the territories. In relations between state and business the partnership can play dominant, subsidiary or supervisory role, regulate the institutional mechanism of financial cooperation, develop strategies, solve conflicts and provide social, communal and infrastructure services.
Currently implementation of the public-private partnership mechanism in Ukraine is complicated because of shortcomings and gaps in legislation, deficit of different levels budgets, institutional inability of local governments to plan and implement partnership projects and low efficiency of economic activity of business entities. Concerning implementation of the mechanism on rural areas it should be substantially enhanced at the national level for many reasons. Firstly economic situation in most rural areas in Ukraine is depressed and community budgets lack funds. It proves the necessity to intensify economic cooperation and introduce other forms of cooperation. On the other hand, many negative socio-demographic trends (migration, depopulation, social exclusion and marginalization) are inherent in rural areas. It makes difficult for local governments to cooperate with communities members. Capability of the state to support partnerships is also complicated major because of underdeveloped organizational and economic support mechanism. Lack of annual plans to finance partnership projects, funds, technical support to implement projects, and no ways to get state guarantees are the evidence.
Taking into account rural territories have no much capacity for development, the mechanism of public-private partnership should include the following key steps: identifying priority areas for PPP application, considering socio-economic potential of different types of the territories and social relevance of a project for a community; improving the qualification level of project management personnel; involvement of the private sector into infrastructural projects; state support for pilot projects; ensuring more transparency in decision making and use of budget resources and simplifying project selection requirements. Implementation of the PPP mechanism on rural areas will improve their infrastructure and satisfy social needs of residents. In order to improve the mechanism of state support for the implementation of PPP projects at the local level it is needed to establish a national specialized agency, define clearly powers of the state authorities, local self-government authorities and members of communities involved into PPP implementation. The other task is to create an informational framework.
The purpose of the article is to substantiate how the public-private partnership’s mechanism can work on rural areas.
Key words: public-private partnership; rural area; local level; mechanism; sustainable development.
Language version: Ukrainian
References
1. Van Huijstee, M., Francken, M., & Leroy, P. (2007). Partnerships for sustainable development: a review of current literature. Environ. Sci., 4(2). 75-89 [in English]. - https://doi.org/10.1080/15693430701526336
2. Ostrovskyy, I.A., Yukhnov, B.Y., & Stefan, S.I. (2016). Publichno-pryvatne partnerstvo yak sotsialna innovatsiya: perevahy ta ryzyky [Public-private partnership as the social innovation: benefits and risks]. Effective economics, 5. Retrieved from www.economy.nayka.com.ua/?op=1&z=4969 [in Ukraine].
3. Kulchiy, I.M. (2017). Publichno-pryvatne partnerstvo yak sposib zabezpechennya staloho rozvytku silʹsʹkykh terytoriy [Public-private partnership as the way to ensure the sustainable rural development]. Problems of legality, 138, 99-108 [in Ukrainian]. - https://doi.org/10.21564/2414-990x.138.108564
4. Simak, S.V. (2016). Instytutsiynyy rozvytok publichno-pryvatnoho partnerstva: teoriya, metodolohiya, mekhanizmy derzhavnoho upravlinnya [Institutional development of public-private partnership: theory, methodology, mechanisms of public administration]. Kyiv: AMU [in Ukrainian].
5. Simak, S.V. (2014). Sutnist ta instrumenty realizatsiyi vzayemodiyi derzhavy ta biznesu [Sence and tools to realize interaction between the state and the business]. Theory and Practice of Public Administration, 1 (44), 135-141 [in Ukrainian].
6. Verkhovna Rada Ukrayiny (2013). Zakon Ukrayiny «Konseptsiya rozvytku publichno-pryvatnogo partnerstva v Ukrayini na 2013-2018 roky». [Law of Ukraine «The concept of public-private partnership development in Ukraine for 2013-2018»]. Retrieved from https://zakon.rada.gov.ua/laws/show/739-2013-%D1%80 [in Ukrainian].
Article publication date: 2019
Date of online version: 2019
DOI: https://doi.org/10.37100/2616-7689/2019/6(25)/3
UDC 338.24(477)
JEL CLASSIFICATION: H54; R51
Mariia Ilina
Dr. Sci. (Econ.), Senior Researcher,
Leading Researcher of the Department of Problems of
Land and Forest Resources Economy of the
Public Institution "Institute of Environmental Economics and
Sustainable Development of the National Academy of Sciences of Ukraine"
ORCID:https://orcid.org/0000-0002-5555-1614
Yulia Shpyliova
PhD (Econ.), Senior Researcher,
Senior Researcher of the Department of Problems of
Land and Forest Resources Economy of the Public Institution
“Institute of Environmental Economics and Sustainable Development of the
National Academy of Sciences of Ukraine”;
ORCID: https://orcid.org/0000-0003-0220-0041
PUBLIC-PRIVATE PARTNERSHIP AS THE MECHANISM OF THE RURAL TERRITORIES’ DEVELOPMENT
Abstract: Public-private partnership is the instrument of cooperation between state and business. It has many forms and functions but the only purpose to improve welfare of the territories. In relations between state and business the partnership can play dominant, subsidiary or supervisory role, regulate the institutional mechanism of financial cooperation, develop strategies, solve conflicts and provide social, communal and infrastructure services.
Currently implementation of the public-private partnership mechanism in Ukraine is complicated because of shortcomings and gaps in legislation, deficit of different levels budgets, institutional inability of local governments to plan and implement partnership projects and low efficiency of economic activity of business entities. Concerning implementation of the mechanism on rural areas it should be substantially enhanced at the national level for many reasons. Firstly economic situation in most rural areas in Ukraine is depressed and community budgets lack funds. It proves the necessity to intensify economic cooperation and introduce other forms of cooperation. On the other hand, many negative socio-demographic trends (migration, depopulation, social exclusion and marginalization) are inherent in rural areas. It makes difficult for local governments to cooperate with communities members. Capability of the state to support partnerships is also complicated major because of underdeveloped organizational and economic support mechanism. Lack of annual plans to finance partnership projects, funds, technical support to implement projects, and no ways to get state guarantees are the evidence.
Taking into account rural territories have no much capacity for development, the mechanism of public-private partnership should include the following key steps: identifying priority areas for PPP application, considering socio-economic potential of different types of the territories and social relevance of a project for a community; improving the qualification level of project management personnel; involvement of the private sector into infrastructural projects; state support for pilot projects; ensuring more transparency in decision making and use of budget resources and simplifying project selection requirements. Implementation of the PPP mechanism on rural areas will improve their infrastructure and satisfy social needs of residents. In order to improve the mechanism of state support for the implementation of PPP projects at the local level it is needed to establish a national specialized agency, define clearly powers of the state authorities, local self-government authorities and members of communities involved into PPP implementation. The other task is to create an informational framework.
The purpose of the article is to substantiate how the public-private partnership’s mechanism can work on rural areas.
Key words: public-private partnership; rural area; local level; mechanism; sustainable development.
Language version: Ukrainian
References
1. Van Huijstee, M., Francken, M., & Leroy, P. (2007). Partnerships for sustainable development: a review of current literature. Environ. Sci., 4(2). 75-89 [in English]. - https://doi.org/10.1080/15693430701526336
2. Ostrovskyy, I.A., Yukhnov, B.Y., & Stefan, S.I. (2016). Publichno-pryvatne partnerstvo yak sotsialna innovatsiya: perevahy ta ryzyky [Public-private partnership as the social innovation: benefits and risks]. Effective economics, 5. Retrieved from www.economy.nayka.com.ua/?op=1&z=4969 [in Ukraine].
3. Kulchiy, I.M. (2017). Publichno-pryvatne partnerstvo yak sposib zabezpechennya staloho rozvytku silʹsʹkykh terytoriy [Public-private partnership as the way to ensure the sustainable rural development]. Problems of legality, 138, 99-108 [in Ukrainian]. - https://doi.org/10.21564/2414-990x.138.108564
4. Simak, S.V. (2016). Instytutsiynyy rozvytok publichno-pryvatnoho partnerstva: teoriya, metodolohiya, mekhanizmy derzhavnoho upravlinnya [Institutional development of public-private partnership: theory, methodology, mechanisms of public administration]. Kyiv: AMU [in Ukrainian].
5. Simak, S.V. (2014). Sutnist ta instrumenty realizatsiyi vzayemodiyi derzhavy ta biznesu [Sence and tools to realize interaction between the state and the business]. Theory and Practice of Public Administration, 1 (44), 135-141 [in Ukrainian].
6. Verkhovna Rada Ukrayiny (2013). Zakon Ukrayiny «Konseptsiya rozvytku publichno-pryvatnogo partnerstva v Ukrayini na 2013-2018 roky». [Law of Ukraine «The concept of public-private partnership development in Ukraine for 2013-2018»]. Retrieved from https://zakon.rada.gov.ua/laws/show/739-2013-%D1%80 [in Ukrainian].
Article publication date: 2019
Date of online version: 2019