Page 19 - Theoretical and Practical Interpretation of Investment Attractiveness

investment attractiveness of regions is a necessary condition for the development of the state
and regions.
The transformation of the country's economy from a centralized management system
to a decentralized system led to a strengthening of the role of administrative-territorial bodies
in regulating economic processes. The existence of differences in the socio-economic
development of each region requires the formation of a balanced regional investment policy.
Administrative-territorial bodies must stimulate and regulate investment processes and
create favorable conditions for attracting investments necessary for the regional economy. In
a certain long-term perspective, regional investment programs certainly lead to a reduction in
socio-economic differences between regions. All this can be done only with the help of a
comprehensive, systematic assessment of the state of the region and identifying its
weaknesses.
The concept of territory does not always indicate the territorial unity of the state.
According to A.I. Dobrynin, the region is a territorially specialized part of the country’s
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economy, characterizing the integrity and coherence of the reproduction process.
According to the socio-political interpretation of the region, the socio-territorial totality
of the region is considered as a set of social, economic and political factors of the region. It
includes a number of details, namely the ethnic composition of the population, labor
resources, social infrastructure, socio-psychological climate, political aspects of regional
development, regional factors and others.
The territory is an integral system that has its own composition, functions, connections
with the external environment, history, culture, and standard of living of the population. This
system: high volume; numerous and varied subsystems with local goals; characterized by a
hierarchical structure. However, the territory itself does not act as an object of investment as
a specific system.
Thus, from the point of view of the topic of this study, when we examined the role of
the investee, it became obvious that it is appropriate to consider properties owned by the
country/region. Investment attractiveness of the country/ region being the object of
investment two factors: external (mainly state) and internal (local) influence factors.
Investment attractiveness is explained by details that can be applied both to the region
(network) and to a specific investment object (enterprise, financial instrument). This
parameter reflects the suitability of the investment object for the specific purposes of certain
investors.
is assessed only by the sum of the investor’s “entry” into the region and non-
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commercial risks . These actions of the host state consist in the adoption of regulatory legal
documents that discriminate against the property interests of foreign investors, the
implementation of economic policies or the implementation of certain political decisions, and
the implementation of investment projects by the enterprise.

7 Dobrynina A.I., Tarasevich L.S. Economic theory. 4th ed. St. Petersburg: 2009. 560 p.
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Note: non-commercial risks are closely related to direct and indirect actions of the host country to harm foreign investors
investing in the economy of the recipient country.
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