The place and role of socio-economic factors in formation of Carpathians region’s economic potential

Abstract

Each region of Ukraine has its own development factors and opportunities for the effective use of resources. The aim of this article is to identify the main socio-economic factors that determine their role in the formation of the economic potential of the Carpathian region. Its economic potential is defined by complex exogenous and endogenous factors. The interrelated combination of all the factors (socio-demographic, labor resources, scientific and technical, information, technological, investment, ecological and economic) provides development services in the region. Each factor can be considered as one of the development potentials of the economic system and as a component of overall capacity development in the region. It should be stated that as a result of a non-complex approach to the organization of production, poor economic policies and misguided environmental activities in the Carpathian region have formed a distorted system of economy. Socio-demographic potential of the region is getting worse: the mortality rate is increasing, natural increase is reducing, the population is aging and migrates from villages to towns and to other regions. The region has a surplus manpower, it is the donor of unskilled workers to Western Europe. The Carpathian region is industrial-agrarian, with over 80% of the total commodity output accounted for by industrial production. In the sectoral structure of the economy it is dominated by resource-and energy-intensive industries: mining and chemical, wood chemical, wood processing, chemical, pharmaceutical, food. Agriculture and resort sector are also developing. The region has the ramified structure of productive capacity which is due to the richness of the resource potential. But the socio-economic structure of the region is characterized by the imbalance of production: 51% of the rural population produces 14.5% of GDP. There are territorial disparities in the development of productive forces; they occur in hypertrophied development of the plains and socio-economic backwardness of the mountain regions. Since 2013 there has been a decline in investment activity of regions of the Carpathian region. The share of industrial enterprises introducing innovation is less than 10 percent. Environmental and economic factors important for the region are: the landscape, the geographical location, climate, resources of mineral waters. The Carpathian region is a relaxation wellness area. Ecological and economic factors are favorable for the development of green tourism. We believe that a system of socio-economic factors forms the strategic potential of the region’s economic complex.