The Financial-Economic Mechanism of Resolving the Russian-Ukrainian Conflict

Abstract

The purpose of the article is the scientific substantiation of the content and structure of the financial-economic mechanism of resolving the intercountry conflict and the peculiarities of its application in the conditions of the Russian-Ukrainian war. The research methodology is based on the quantitative and qualitative analysis of financial and economic instruments used in Ukraine in the development of the State policy to resolve the Russian-Ukrainian conflict, and their scientific generalization to substantiate the components of the financial and economic mechanism for its implementation. The authors have examined the financial and economic resources of Ukraine in the field of defense and compared them with the capabilities of the Russian Federation, the mechanisms of distribution of expenditures of the State Budget of Ukraine on national defense and public order, the role of budget programs in financing security measures are analyzed. In addition, an analysis of the instruments of economic influence used by Ukraine to limit the capabilities of the Russian Federation, in particular economic sanctions, was carried out. The levers of economic support for Ukraine used by the international community are characterized. The structure of the financial-economic mechanism of resolving the intercountry conflict, which includes certain directions, goals, subjects, objects, instruments and forms of the State influence, is substantiated. It is shown that economic incentives and restrictions have both a direct and indirect impact both on the possibilities of Russia’s military actions and on the possibilities of military counteraction on the part of Ukraine. Blocking the economic activity of the Russian Federation entails a multiplicative restrictive effect for its economy and the federal budget. Such economic restraint reduces the possibility of financial support for hostilities and affects the decline in the standard of living of Russians. Instead, economic assistance to Ukraine stimulates its economy and supports its financial resources both directly and indirectly through the market mechanism.

Keywords

• financial resources
• economic incentives
• economic constraints
• defense budget