Page 20 - Theoretical and Practical Interpretation of Investment Attractiveness

The investment attractiveness of a country is a set of objective economic, social and
natural characteristics, tools, opportunities and restrictions that determine the influx of
investment into the territory and are assessed by investment activity. In turn, a country’s
investment activity can be viewed as the intensity of investment inflows. The integral
investment attractiveness of a country/region is the total level of objective socio-economic,
natural-geographical and environmental indicators that characterize the conditions of
economic development of the country/region and have a positive or negative impact on the
formation of investment activity in the country/region. This.
The category “Investment potential” is interpreted as an opportunity to direct funds
into assets that will be used for a long time, including securities, in order to increase income
or other economic results.
The approach proposed by F. S. Tumusov, devoted to the analysis of the formation and
implementation of the country’s investment potential, also deserves attention. By “investment
potential” he understands the totality of investment resources, representing a part of
accumulated capital, visible in the form of investment demand in the investment market,
which has the ability to become real investment demand, ensuring the satisfaction of the
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material, financial and intellectual needs of capital reproduction.
In general, the investment potential of a region can be considered as the sum of the
opportunities for investment activity in a favorable investment environment, determined by
its economic policy, internal and attracted economic resources of the region.
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S.V.Zenchenko, M. A. Shemetkin in their research identify a number of factors that
have a greater impact on the desire of investors. In particular, the most important factors for
assessing the investment potential of a country/region are: resource and raw materials
(average reserves of the main types of natural resources); production (the total result of the
activities of farms in the region); consumption (purchasing power of the region's population);
infrastructural (economic and geographical position of the region and its infrastructure
support); intellectual (level of education of the population); institutional (level of
development of leading institutions of a market economy); innovative (level of
implementation of the achievements of scientific and technological development of the
region). It should be noted that investment potential is one of the criteria for classifying
regions.
G. Marchenko and O. Machulskaya, citing a typology of regions, emphasize the
following : The first three types are “locomotives”, “base regions” and “growth poles”.
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Lokomotivlar will have high investment potential and internal development resources, which
will ensure sustainable development even without significant support from the center.
“Growth Poles” are regions with a small population and economic power, as well as a low
level of investment risk.

9 Tumusov F.S. Investment potential of the region: theory, problems, practice. M., “Economics”, 1999. 272 p.
10 Zenchenko S.V., Shemetkina M.A. “Investment potential of the region.” Collection of scientific works of SevKavSTU.
Series "Economics". 2007. No. 6.
11 Marchenko G. , Machulskaya O. Tool for a new regional policy . On the “risk-potential” rating plane, poles and growth
points clearly appeared . http://raexpert.ru/ratings/regions/2005/part4/

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