The central place in the system of mechanisms of the PADR is the financial and
economic mechanism, which is the driving force behind the positive changes. Other
mechanisms create favourable conditions for the use of financial and economic
instruments and instruments, complement and enhance its effect.
Only with the necessary organisational changes, political support, legal support
and the required public administration can a synergistic effect be accelerated, which
will accelerate the implementation of the sustainable, balanced development of the
regions, which is the key to increasing competitiveness and implementing the concept
of sustainable development of Ukraine.
The financial and economical mechanism of state governance for the development
of specific regions may have particularities depending on the natural resource potential,
the existing structure of the industrial complex, the severity of social and
environmental problems, and achievements in economic development.
It is this mechanism that is critical in realising the primary goal of state
governance by regional development - ensuring economic growth necessary to meet
the social needs of the population at the level of the best world achievements while
preserving natural resources for future generations.
The main milestones of the formation of the financial and economic mechanism
of state management of the region's development are presented in Fig. 2
Undoubtedly, ensuring the social standards of the most developed countries, the
process is quite lengthy, which should be carried out in stages. Therefore, in the first
stage of the formation of the financial and economic mechanism, it is necessary to
determine the strategic tasks of the region. Economic instruments of influence on
processes of regional development are: development of theoretical and methodological
bases of justification of priority directions of development of the region; improvement
of the structure of the economic complex; the formation of a system of balanced
indicators and approaches to ensure harmonious development of the areas of the region;
creation of the potential of sustainable development.
The publication of indicative plans guides business entities, a population of
districts and cities in the region.
Implementation of strategic plans is impossible without sure financial support and
stimulation of actions necessary for the realisation of the main tasks of sustainable
development.
The financial mechanism of public administration at the regional level plays an
essential role in a budget that, under market conditions, becomes a particular regulator
of socio-economic processes [22, p. 336].
The budget has two main functions: financing and regulation. At the same time,
the role of budget allocations in ensuring social development depends on the financial
model.
- 606 -