Investment policy
The main goal of investment policy is to strengthen the investment potential of the Ukrainian economy, increase the volume of investments in the real sector of the economy through the active involvement of all sources of financing, and improve the efficiency of their use to achieve stable socio-economic development.The implementation of a deep structural restructuring of the Ukrainian economy requires a substantial increase in the volume of investments, consolidation of all sources of investment, and intensification of investment activity.
An important factor for the development of the city's economy should be the concentration of efforts to improve the efficiency of using domestic investment resources and increase the inflow of investments from foreign investors.
In 2003, the situation with the inflow of foreign investments improved significantly. Foreign investors invested USD 24.1 million in the city's economy, which is almost 8 times more than in the corresponding period of the previous year, of which 98.5% came in monetary form. All investments came from European countries. The total volume of foreign direct investment in the city's enterprises as of October 1 amounted to USD 72.2 million. Since the beginning of the year, 13 joint ventures with the participation of foreign partners have been registered in the city of Lutsk.
At the enterprises of the city of Lutsk, measures of the "Program for the Development of Investment Activity for 2003-2010" and the "Main Directions of Competition Policy for 2002-2004" are being implemented.
The city is participating in the UN Program project "Support for the Development of Small and Medium Enterprises in Ukraine".
In order to provide the widest possible access for potential investors to analytical information about the city's investment opportunities, information about investment projects and business proposals of business entities offered for implementation has been placed on the city's official website.
In order to promote the city, materials were collected, fundraising was organized, and a booklet about the city entitled "Lutsk Investment" was published, which included the most significant events and developments that took place in the city in recent years.
Today, the city can offer a potential investor:
- an advantageous border location;
- the availability of a sufficient educational base for training specialists in any specialization;
- the availability of institutions supporting the operation of enterprises (banking institutions and credit unions, audit and consulting firms);
- developed telecommunications and transport networks.
Priority areas for investment in the city are the creation of new capacities and the reconstruction of existing capacities in the machine-building, food, and processing industries.
The main problems, that restrain investment activity and the increase in investment volume are political and economic instability in the state, low solvency of the population and enterprises, which restrain the expansion of foreign investors' activities in the city. As a result, the role of foreign capital in reforming the city's economy remains limited.
In addition to enterprises' own funds, the population has great potential for domestic investment. Today, one of the important tasks is how to attract these funds into the process of investing in the city's economy.
The main source of investment remains the own funds of enterprises and organizations, as well as the own funds of citizens. In the total volume of investments, the share of expenditures on construction and installation work is decreasing, and the share of investments in the purchase of machinery and equipment is growing significantly, which contributes to raising the technical level and efficiency of production.
Main goals of the city's investment policy for 2004:
- creating a favorable investment climate and stimulating the inflow of capital investments into the city's economy;
- ensuring openness and transparency in the privatization of municipal property;
- promoting work on the development and implementation at enterprises of investment projects aimed at raising the technical level of production and developing competitive products;
- informing potential investors through the Internet and the media about investment projects proposed for implementation;
- stepping up efforts to involve business entities interested in receiving investments in participation in investment forums and conferences for direct discussion of investment projects with investors;
- mobilizing all sources of investment resources and their effective use;
- forming an information system on foreign investment and advisory services;
- providing methodological and advisory assistance to business entities in preparing investment projects that would meet international standards;
- stimulating the development of the production sector.
Criteria for achieving the goals of the investment policy
- clarifying priority areas for attracting investment;
- introducing mechanisms to stimulate long-term lending to production by commercial banks;
- stimulating an increase in citizens' savings and directing them toward investment;
- promoting the attraction of foreign investors to long-term investment projects.
Priority directions of investment and innovation development of the city in 2004:
- introduction of resource-saving and environmentally safe technologies;
- reconstruction of the city's outdoor lighting using modern energy-saving technologies by "Lutsk Electrotechnical Enterprise", which will make it possible to reduce energy consumption and reduce the use of budget funds.
The main priorities of the city's economy will be based on expanding the product range and increasing the production of products and goods.
The main sources of investment for the city's economic development for 2004 remain the funds of enterprises and organizations of all forms of ownership, investments from the state and local budgets, and the implementation of the "National Program for the Promotion of Small Business Development".
Create a stable lending system from various sources (long-term bank loans, loans from insurance, investment and other commercial funds, credit unions, funds of the population). Intensifying investment activity will contribute to the creation in the city of centralized funds, long-term loans and financing of priority construction projects.
Intensify investment activity by improving the infrastructure for attracting investment:
- introduction of progressive mechanisms for credit-guarantee and financial support of entrepreneurship;
- granting tax benefits on funds of enterprises that are directed to the development of their own production (with the creation of new jobs), as well as the city's social, engineering, and transport infrastructure;
- providing long-term preferential loans to citizens for housing construction in addition to their own savings.