Научная статья на тему 'PROBLEMS AND PROSPECTS OF MANAGEMENT OF RURAL DEVELOPMENT'

PROBLEMS AND PROSPECTS OF MANAGEMENT OF RURAL DEVELOPMENT Текст научной статьи по специальности «Социальная и экономическая география»

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Ключевые слова
rural areas / development management / reformation / state support / staffing

Аннотация научной статьи по социальной и экономической географии, автор научной работы — Inna Tomashuk

The purpose of the research is to study problems of rural development management, to analyse the effectiveness of management of the resource potential of rural areas, and to study the socio-economic priorities of their development, as well as to determine the justified ways of their solution in modern conditions. Methodology. The system approach to studying the development of rural areas makes it possible to consider components in the relationship between themselves and interaction with components of other systems. The state, problems, and prospects of rural development management are considered. The necessity of significant changes in the state policy of rural management is determined. It is substantiated that the current trends in the development of rural areas of Ukraine take place in the direction of narrowing the sphere of application of labour and the mismatch of professional and skilled workers’ quality to the needs of employers, and the growth of unemployment. The results showed that the revival of rural areas depends primarily on the level of economic development of the country. Multifunctional development of the village should be carried out taking into account the integrated approach to solving the problems of the agrarian complex, villages, rural areas in general, through the combination of interests of inhabitants of rural areas, rural communities, local government, and the state, applying social and economic levers of regulation of the relevant relations in conjunction with the organizational and legal ones. The subject of the research is the mechanisms for managing the development of rural areas. The emphasis is made on the imperfection of the modern mechanism of the financial and economic provision of rural development management, in particular, regarding the distribution of state budget funds in this area. The impact of a clear state policy that is aimed at supporting regional development is outlined. The importance of the issue of transferring significant powers and resources to places is investigated; there must be an active position and mutual responsibility of local self-government, local business, and civil society for the development of their territory. The main problem is outlined that the financial situation of rural residents in terms of the unstable development of all spheres of the country’s economy is more complicated than that of the urban population. It is emphasized that the current state of social and economic infrastructure of rural areas confirms the existence of a deep crisis. Taking into account the condition and problems of rural development and modern European traditions in this area, it is proposed to finance the management of rural development using three sources – the state budget, local budget, and rural development funds. Potential sources of the formation of local budget funds, which will be directed to ensuring issues of management of rural development and rural development funds, are determined. Specific directions for the use of funds of each of the mentioned sources are proposed. It is determined that for Ukraine, it is important to study foreign skills of formation of sustainable development of rural areas, analyse their regularities and trends of development. It is proved that the experience of countries of the European Union in the context of European integration should become especially useful for the national economy. Practical implementation. The emphasis is made on the fact that state regulation is the main direction of ensuring sustainable development of the Ukrainian village and a means of ensuring the equilibrium of the Ukrainian economy. Originality. It is outlined that one of the directions of the rural development strategy may be to strengthen initiatives of local entrepreneurs, which will be assisted by local partnerships and the state. The urgent task of further scientific development of this problem is to study the influence of the basic, district, and regional levels of state policy on the management of rural development.

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Текст научной работы на тему «PROBLEMS AND PROSPECTS OF MANAGEMENT OF RURAL DEVELOPMENT»

Baltic Journal of Economic Studies „ „„,„ -J--Vol. 3, No. 5, 2017

DOI: http://dx.doi.org/10.30525/2256-0742/2017-3-5-214-220

PROBLEMS AND PROSPECTS OF MANAGEMENT OF RURAL DEVELOPMENT

Inna Tomashuk1

Vinnytsia National Agrarian University, Ukraine

Abstract. The purpose of the research is to study problems of rural development management, to analyse the effectiveness of management of the resource potential of rural areas, and to study the socio-economic priorities of their development, as well as to determine the justified ways of their solution in modern conditions. Methodology. The system approach to studying the development of rural areas makes it possible to consider components in the relationship between themselves and interaction with components of other systems. The state, problems, and prospects of rural development management are considered. The necessity of significant changes in the state policy of rural management is determined. It is substantiated that the current trends in the development of rural areas of Ukraine take place in the direction of narrowing the sphere of application of labour and the mismatch of professional and skilled workers' quality to the needs of employers, and the growth of unemployment. The results showed that the revival of rural areas depends primarily on the level of economic development of the country. Multifunctional development of the village should be carried out taking into account the integrated approach to solving the problems of the agrarian complex, villages, rural areas in general, through the combination of interests of inhabitants of rural areas, rural communities, local government, and the state, applying social and economic levers of regulation of the relevant relations in conjunction with the organizational and legal ones. The subject of the research is the mechanisms for managing the development of rural areas. The emphasis is made on the imperfection of the modern mechanism of the financial and economic provision of rural development management, in particular, regarding the distribution of state budget funds in this area. The impact of a clear state policy that is aimed at supporting regional development is outlined. The importance of the issue of transferring significant powers and resources to places is investigated; there must be an active position and mutual responsibility of local self-government, local business, and civil society for the development of their territory. The main problem is outlined that the financial situation of rural residents in terms of the unstable development of all spheres of the country's economy is more complicated than that of the urban population. It is emphasized that the current state of social and economic infrastructure of rural areas confirms the existence of a deep crisis. Taking into account the condition and problems of rural development and modern European traditions in this area, it is proposed to finance the management of rural development using three sources - the state budget, local budget, and rural development funds. Potential sources of the formation of local budget funds, which will be directed to ensuring issues of management of rural development and rural development funds, are determined. Specific directions for the use of funds of each of the mentioned sources are proposed. It is determined that for Ukraine, it is important to study foreign skills of formation of sustainable development of rural areas, analyse their regularities and trends of development. It is proved that the experience of countries of the European Union in the context of European integration should become especially useful for the national economy. Practical implementation. The emphasis is made on the fact that state regulation is the main direction of ensuring sustainable development of the Ukrainian village and a means of ensuring the equilibrium of the Ukrainian economy. Originality. It is outlined that one of the directions of the rural development strategy may be to strengthen initiatives of local entrepreneurs, which will be assisted by local partnerships and the state. The urgent task of further scientific development of this problem is to study the influence of the basic, district, and regional levels of state policy on the management of rural development.

Key words: rural areas, development management, reformation, state support, staffing.

JEL Classification: P25, Q14, R11, R58

Corresponding author:

1 Department of Translation and Philology, Private Higher Educational Institution "Ivano-Frankivsk King Danylo Halytskyi University of Law". E-mail: [email protected]

1. Introduction

The main purpose of changes in agriculture in Ukraine is to create an effective system of agrarian relations, increase the production of agricultural products, finally solve the food problem in the country, provide the industry with the necessary raw materials, and significantly increase the well-being of peasants.

Rural areas of Ukraine are characterized by a number of problems, most of which have not been resolved for decades. The lack of a well-formulated and effective rural development management system leads to a permanent deterioration in the quality of life of the rural population, a decrease in its overall population and working age, in particular (due to both natural reduction and active migration processes), poor state of infrastructure provision, lower incomes, and the lack of alternatives to agriculture, at the same time accompanied with low economic efficiency and the high complexity of its implementation.

Thus, the topics discussed in the article, namely, the study of problems and prospects for the management of rural development, is very relevant.

The purpose of the article is to study the existing problematic issues related to the management of rural areas development and to identify the main directions of its improvement. The research objective is to carry out a comprehensive analysis of the current state and problems of rural development, to substantiate criteria for optimizing their management, to determine the strategic priorities of their development.

Today it is necessary to state the absence of the necessary prerequisites for the effective realization of the potential of rural areas, as well as significant disadvantages and the absence of a management system for their development. Systemic, monographic, analytical, and other methods of research are used to study theoretical and methodological foundations of rural development management. The potential of the development of rural areas of Ukraine, as well as the state as a whole, can be disclosed and implemented only if an effective system of public administration is formed. Thus, the scientific novelty of the article is to improve public administration in the study of the current state of development of rural areas and the economy of Ukraine as a whole, as well as the analysis of recommendations of individual scientists regarding the fundamental changes in managerial decisions based on private-public partnership.

The complexity of reforming public administration in the development of rural areas is the need to maintain systematic, comprehensive character, and take into account all aspects of this process, since each of its components plays an important role in the implementation of strategic objectives of the new state agricultural policy.

At the same time, the effectiveness of public administration depends on the observance of value

orientations. Today we can state the absence of well-formed and valid values in the management of rural development, which leads, in particular, to the squandering of state resources and low effectiveness of measures for their socio-economic development (Krupin, Zlydnyk, 2012).

Today in Ukraine, decentralization is one of the priority directions for solving problems of rural development management. In addition, the President of Ukraine signed the Law of Ukraine "On Voluntary Association of Territorial Communities", which regulates relations that arise in the process of voluntary association of villages, settlements, and cities. Thus, it is planned that this integrated approach will help in solving the main problems of the development of rural areas of Ukraine, which is based on the principles of sustainable development.

2. The role of rural areas in the national economy

Rural areas play an important role in the national economy. They provide food to the population and raw materials to the processing industry.

The effectiveness of the development of the potential of rural areas depends on their effective management. The main subject of management in the countryside is local self-government bodies. Granting them with appropriate powers and resources will solve the problems of creating a favourable living environment for peasants. Mechanisms of effective interaction between enterprises of different forms of ownership and different spheres of the economy of regions are not worked out, which reduces the manageability of the agricultural sector.

3. Problems of management of rural development

Today it is extremely difficult to imagine the economic development of Ukraine without the revival of the Ukrainian village. The tendency towards the deterioration of the socio-economic situation of rural areas leads to an increase in the imbalance in the placement of productive forces of the state, which results in the outflow of resources in large cities, which concentrate an increasing part of the financial, industrial, scientific and technical, and personnel potential. Instead, the village, with underdeveloped infrastructure and low living standards, continues to be in a depressed state. The process of reforming rural areas is slowed down, which causes a number of problems (Fig. 1). The lack of a well-formulated and effective rural development management system leads to a permanent deterioration in the quality of life of the rural population, a decrease in its overall population and working age, in particular (due to both natural

reduction and active migration processes), poor state of infrastructure provision, lower incomes, and the lack of alternatives to agriculture, while at the same time it is accompanied by low economic efficiency and the high complexity of its implementation.

4. Vectors of rural development policy

World experience and domestic practice convince that the level of development of the economy and the quality of life of the country's population can be assessed by the level of development of rural areas. This

Problems of management of rural development

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Low entrepreneurial activity in rural areas

Low quality and competitiveness of agricultural products

Irrational harvesting and processing of agrarian products, especially in the complex processing of raw materials, mechanization and automation of production processes, as well as packaging of finished products

An insignificant amount of export of agricultural products -1

Unsystematic institutional development of rural areas, in particular, the excessive number of state and inadequate

development of non-state bodies capable of effective implementation of regional policy tasks in interaction and coordination

Lack of skilled personnel

Low investment attractiveness of the agricultural sector

The inadequate agrarian policy of the state, in particular, lack of effective programs of financial and credit support for producers of agrarian products, significant tax burden, suspended land market reform, ineffective implementation of agricultural development programs

Lack of motivation to work, the inertia of rural residents, the weakness of rural self-government and the lack of preparedness of rural communities to participate in local development projects

The decline of social, industrial, and market infrastructure in the countryside, which leads to an increase in the cost of production, significant loss of production during transportation and storage

The absence of a regional strategy for the development of foreign trade in agro-food products, which leads to a deformed structure of export of agro-food products

I

Deprecation and an insufficient amount of agricultural machinery, which leads to a breach of the production technology and losses of a significant part of the crop

Lack of cooperation between scientific institutions and producers of agro-food products, which results in insufficient research and development in the agrarian sector aimed at improving the quality of seed and breeding material, increasing productivity of agricultural production

Fig. 1. Problems of management of rural development

Source: compiled by the author by research results

is explained by the fact that it is impossible to provide integrated development, to lay a solid foundation for the future without creating high standards of living for the rural population (Fig. 2). Taking this into account, the leading countries of the world are developing effective mechanisms for preserving the countryside, rural lifestyle, and rural traditions. With this purpose, the policy of socio-economic development of rural areas is constantly being improved, requiring appropriate changes to the management system, increasing expenditures for the implementation of state programs (Danylenko, 2015).

Vectors of rural development policy

3E

competitiveness improvement

of the agrarian sector of the environment

o

improving the quality diversification

of life in rural areas of the economy

Fig. 2. Vectors of rural development policy

Source: compiled by the author by research results

The key to effective implementation of rural development policy is its human resources.

According to M. Malik, professional staff is the main condition for the implementation of the chosen strategy of sustainable development of rural areas, that is, managers must answer it. In our country, employees of state administrations responsible for economic and social development are, as a rule, specialists in relatively narrow issues of planning and management. They are busy with the solution of current problems, they do not pay enough attention to perspective issues, do not have experience of sustainable regional development in the conditions ofmodern market economy and development of self-government, do not have system representations and knowledge of modern methodological approaches and algorithms (Malik, 2008).

Unfortunately, today, in rural areas, traditional hierarchical structures with a rare splash of market mechanisms dominate in regional authorities. Advantages of such organizational structures consist of a clear division of functions and hierarchical co-subordination of all management units, the ordering of a system of rules and standards that determine the functioning of the governing bodies. Disadvantages are expressed in the strict conditionality of behaviour, difficulties of organizing interactions within the organization, and the inability to rapid innovations (Onyshchenko, Yurchyshyn, 2006).

Integration of plans for sustainable development of rural areas into a strategy of socio-economic development of the state has not yet been widely practiced. As a result, domestic interregional

cooperation is practically absent; budget funds are not used effectively. State target programs also do not solve this task. Many Ukrainian scholars recognize that in Ukraine as a whole, the culture of planning the use of the territory has been lost (Antonov, 2010).

5. Modern state of management of rural development

The current state of management of rural areas' development requires a significant increase in the role of the Ministry of Agrarian Policy and Food of Ukraine. A significant influence on the financial provision of agrarian enterprises is also made by regional authorities for granting loans, making lease agreements, and so on.

AIC and rural development are interdependent categories. Indeed, the effective use of the resource potential is a guarantee of the well-being of the rural population. In order to improve the socio-economic situation in the countryside, the state envisaged in the budget for 2018 almost 3 billion UAH, which will be directed to the financial support of agricultural producers through full or partial VAT compensation. This program was launched in 2017 as a substitute for the preferential VAT regime for farmers. Recall that the preferential VAT payment regime for farmers existed from 1999 to 2016 (and only partially in the past 2017). In the budget of 2017, 4.77 billion UAH was put into this program, and not all companies, but only those that specialize in certain types of activities, fell under the financial support program.

The agrarian budget for 2018 is 6.3 billion UAH. Financing of credit easing program for agricultural producers has been substantially reduced (Fig. 3).

350 300 250 200 150 100 50 0

300

1 66

2017 2018

I Credit easing program, million UAH

Fig. 3. Financing of credit easing program

for agricultural producers, 2017-2018, million UAH

Source: compiled by the author by research results

As shown in Fig. 1, in 2018, expenditures from the state budget for this program in comparison with 2017 have decreased by 4.5 times and amount to only 66 million

UAH. Such a situation greatly reduces opportunities for farmers to attract credit resources.

Positive for the farmers in the budget of 2018 are costs to compensate for the cost of agricultural machinery. For this program, 1 billion UAH is included in the draft budget for 2018. Many agribusinesses need to upgrade their equipment. It is this program that will help to equip and modernize agricultural machinery. In addition, it is worth considering the mechanism of mortgage lending to agricultural producers.

As H.M. Kaletnik notes, mortgage lending is a promising direction and a powerful source of financial resources for agricultural production, which will be the driving force of effective management of rural development. Efficiently functioning mortgage mechanism should become a lever and a stimulating factor in the financial and economic growth of the agro-industrial complex of Ukraine while ensuring the social development of rural areas (Kaletnik, 2013).

The effectiveness of rural development management should be based on the principles of private-public partnership (Fig. 4).

Such a combination is the basis of the sustainable development of rural areas.

Management requires the definition of clear benchmarks, as regards the desired socio-economic status, so the methods (means) for achieving it. Overcoming the problems in the agricultural sector requires direct intervention by the state through financing specific targeted rural development programs.

6. Basic conditions

for the development of rural areas

The rural development policy consists of three major parts: support for agricultural producers, environmental protection, and support for integrated rural development projects.

In Ukraine, in recent years, when there was a rethinking of the state regional policy on the basis of better European experience, the rural development policy has been identified as a part of the regional development policy.

Creating comfortable living conditions

Public-private partnership

Support for production and small business

\7\7

Mobilization of internal potential of self-development

Z\Z\

Transparent conditions for investments; strategic planning; development of self-government

13

« o & & s w o & £ o ^

Ö ¡2 'S e o s •o Si

'S J J

RURAL AREAS

Fig. 4. Scheme of development of rural areas

Source: compiled by the author by research results

Fig. 5. Basic conditions for the rural development

Source: compiled by the author by research results

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In addition, there are basic conditions for the development of rural areas, which are the key to their effective development (Fig. 5).

Also important is the regulation of economic needs in accordance with the capabilities of the natural environment; maximum provision of rural territories with their own resources through their most rational and integrated use. The key is the rational implementation of all the achievements of scientific and technological progress in production activity, which does not allow or minimize the depletion and degradation of resources, especially land. The development and placement f production, taking into account the natural conditions and resource capabilities ofeach region, their protection, and most rational use, also belong to the fundamental principles of the management of rural areas (Fig. 6).

Fig. 6. Sources of funding for rural development

Source: compiled by the author by research results

The management of human and labour-resource potential is an integral part ofthe integrated management of rural areas. The level of labour supply of the rural economy depends on the number of labour resources, their location, sex and age composition. Workable rural areas have the opportunity to develop and diversify their economies more intensively (Kyrylenko, 2003).

7. Principles of management of rural development

We note that the subsystem of management and organization of rural areas is formed by: village and settlement councils, rural communities, bodies of management of objects of production and social and economic activity, representations of public socioeconomic, social, and environmental organizations,

Fig. 7. Principles of management of rural development

Source: compiled by the author by research results

associations, and foundations. The centres of the organization of rural territories are villages and settlements (with their rural and settlement councils), population centres that are subject to them, separate agricultural settlements. Direct administrative influence on the development of rural areas is carried out by the raion and regional bodies of local self-government and, on a national scale, state authorities, which are based on clear principles (Fig. 7) (Syniavska, 2012).

8. Conclusions

The state and prospects for the development of rural areas depend primarily on the level of economic development of the country. Rural areas are an extremely complex object of administrative influence.

In the management of rural areas, one must take into account that the achievement of a high standard of living of the population is the main goal of the economic development of rural areas. Therefore, the key to effective management of the development of rural areas and the agro-industrial complex is the professional staffing, the need to intensify innovation activities, the rational introduction of scientific and technological progress in production activities, the effectiveness of state and regional rural development programs.

The prospect of further development of the revival of rural areas should be the study of the development of agrarian and non-agrarian activities, capable of creating the necessary financial base for serious socio-economic transformations in the village in order to ensure adequate living conditions of the population.

References:

Antonov, A. V. (2010). Udoskonalennia systemy upravlinnia silskymy terytoriiamy [Improvement of control system by rural territories]. Derzhavne upravlinnia: udoskonalennia ta rozvytok [State administration: improvement and development] (electronic journal), no.10. Retrieved from: http://www.dy.nayka.com.ua (accessed 14 Dec 2017). Antoniuk, G. Ya., Panyura, J. Y. (2013). Problemy rozvytku APK na silskykh terytoriiakh Lvivshchyny [Problems of development of APK on rural territories of Lviv Region]. Socio-economic problems of modern period of Ukraine, vol. 6, pp. 220-228.

Danilenko, A. S. (2015). Priorytetni napriamy zabezpechennia rozvytku silskykh terytorii Ukrainy [Priority directions of providing of development of rural territories of Ukraine]. Economy and management APK, no. 1, pp. 10-13.

Kaletnik, G. M. (2013). Ipotechne kredytuvannia v silskomu hospodarstvi Ukrainy [Mortgage lending in agriculture in Ukraine]. Economy of APK, vol. 7, pp. 58-63.

Kyrylenko, I. G. (2003). Pro khid reformuvannia ta zakhody shchodo polipshennia sytuatsii na seli [About motion of reformation and measures in relation to the improvement of situation on the village]. Economy of APK, no. 1(99), pp. 3-11.

Kropivko, M. F. (2005). Orhanizatsiia derzhavnoho i samovriadnoho upravlinnia rozvytkom silskykh terytorii [Organization of state and caMOBp^gHoro administration development of rural territories]. Economy of APK, no. 11(133), pp. 60-62.

Krupin, V. Ye., Zlydnyk, Yu. R. (2012). Tsinnisni oriientyry upravlinnia rozvytkom silskykh terytorii [The Valued reference-points of management development of rural territories]. Announcer of the National university "Lviv politekhnika": Management and enterprise in Ukraine: the stages of becoming and problem of development, no.748, pp. 76-181.

Malik, M. Ya., (2008). Do pytannia staloho rozvytku silskykh terytorii [To the question of steady development of rural territories]. Economy of APK : international scientific and production magazine, no. 5, pp. 51-55. Onyshchenko, O. M., Yurchyshyn, VV. (2006). Silskyi rozvytok: osnovy metodolohii ta orhanizatsii [Rural development: bases of methodology and organization]. Economy of Ukraine, no. 10, pp. 4-13. Syniavska, I. M. (2012). Upravlinnia silskymy terytoriiamy ta pidvyshchennia yoho sotsialno-ekonomichnoi efektyvnosti [Management and increase of him rural territories socio-economic efficiency]. Scientific works of the Poltava state agrarian academy. Series: Economic sciences, vol. 1(4), pp. 262-265.

Chukhno, I. A. (2015). Vyznachennia dzherel finansovo-ekonomichnoho zabezpechennia derzhavnoho upravlinnia rozvytkom silskykh terytorii v suchasnykh umovakh [Determination of sources of the financial economic providing of state administration development of rural territories in the modern terms]. Efektyvna ekonomika [Effective economy] (electronic journal), no. 3. Retrieved from: http://www.economy. nayka.com.ua Shulha, O. A. (2014). Zarubizhna praktyka upravlinnia rozvytkom silskykh terytorii: transformatsiia dosvidu dlia Ukrainy [Is Foreign practice of management development of rural territories : transformation of experience for Ukraine]. Agrarian economy, vol. 7, no. 1-2, pp. 23-28.

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