Regions with Low Financial Sustainability: Analysis and Enhancement of Development

Abstract

This article presents an analysis of the socio-economic development and fiscal position of the subjects of the Russian Federation with low financial sustainability. The existing domestic and foreign approaches to understanding the concept of "financial sustainability of territory" are analyzed. It is proved that the regions with low financial sustainability include the subjects of the Russian Federation with a high level of gratuitous receipts in the structure of the regional budget and lagging behind the average Russian regions in terms of basic economic parameters. The relevance of the study lies in identifying problems that hinder the economic growth of such regions, as well as in developing measures to improve interbudget relations. ITo carry out the analysis and identify the specifics of management of these territories, the authors identify a group of regions with low financial sustainability, having different geographical location and degree of intensity of this problem (the Republics of Mordovia and Tyva, the Trans-Baikal Territory, the Pskov and Oryol Regions, the Jewish Autonomous Region), and apply an original methodological approach based on the assessment of the socio-economic situation and the fiscal position. As a result, both general socio-economic (depopulation, low wages, unemployment, depreciation of fixed assets, low investment and innovation activity) and fiscal (budget imbalance, low level of financial independence, debt burden) problems of these subjects of the Russian Federation, as well as problems specific to each of them, are identified. Measures to enhance economic development and growth of the income base of regions with low financial sustainability are proposed, and suggestions for improving regulatory legal acts in the field of state regional management are formulated.