Финансы: теория и практика (Oct 2017)
THE INVESTMENT ATTRACTIVENESS AND INVESTMENT CLIMATE OF A REGION: TO THE ISSUE OF DEFINITION AND ASSESSMENT
Abstract
The economicscience todayfails to answer the question whether the terms “investment climate”and “investment attractiveness’ are identical in meaning. The time-based approach to the assessment of the investment climate of a region suggested by the author draws a clear distinction between the notions of investment attractiveness and investment climate. The investment attractiveness evaluation makes use of the investment potential and risk; the conclusion on the investment climate of a region is made based on the data about its investment attractiveness over a long-term period (10 years and more). Therefore, the investment climate of a region is regarded as its investment attractiveness in the dynamic aspect. The author’s time-based approach has been tried out on three regions - the Nizhny Novgorod Region, the Smolensk Region and the Republic of Buryatia. The information sources included statistical data for 2001-2012, statutory documents, news media. The evaluation of the investment climate in the regions exposed negative tendencies. The information on the Smolensk Region and Republic of Buryatia provide evidence of the end of the “linear growth”period of the investment attractiveness observed earlier in 2002-2007.The NizhnyNovgorod Region is so far holding its positions -investors are still hoping for a slight growth in the years to come. Even so, the investment risks are high for all the regions analyzed, and the investment climate can be characterized as weakly favorable. It may be assumed that the basic function describing the dynamics of the investment attractiveness (trend search) looks like a sine wave. However this assumption may be only proved by statistical data gathered over 20 or more years.
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