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PROBLEMS OF COMPETITIVENESS OF THE COUNTRY'S INDUSTRY AND THEIR SOLUTIONS

Научный труд разместил:
Pesadsan
1 июля 2020
Автор: Balajayeva T. P.

PSYCHOLOGICAL SCIENCES / <<€©LL©MUM~J©U®MaL>>#M6q),2©2©

Balajayeva T.P.

Ph.D - student, Baku State University DOI: 10.24411/2520-6990-2020-11827 PROBLEMS OF COMPETITIVENESS OF THE COUNTRY&S INDUSTRY AND THEIR SOLUTIONS

Abstract

The article identifies ways to increase the competitiveness of the industry of country in modern conditions on the basis of a comprehensive analysis and scientifically based proposals and recommendations in this direction. At the same time, the main directions of increasing the competitiveness of the country&s industry in modern conditions have been scientifically studied.

The formation of a competitive environment in the domestic market leads to an increase in the level of welfare of society, the directing of economic resources to the production of goods and services that can give the country a competitive advantage. The establishment of market mechanisms in a competitive environment, the maximization of welfare, the minimization of costs, are the fundamental criteria for the economy to achieve a leading position in terms of absolute and relative advantage.

Although the state programs for socio-economic development of many regions have resulted in increases in the level of macroeconomic indicators in the country, it should be noted that the analysis of socioeconomic development reveals many problems. Among the problems, the first to attract attention is the investment in Baku, especially in the industrial sector. Thus, in 2004-2009, the share of Baku city and Ab-sheron economic region in the total investments in fixed assets in the country&s industry was up to 90%. Such a territorial structure of investments leads to a high share of Baku and Absheron in both the country&s gross domestic product and the structure of industrial output, and leads to an increase in disparities in the territorial structure of the country&s economy [2 p.46].

The volume and structure of investments have a direct impact on ensuring sustainable and balanced development of the country&s industry, as well as other sectors of the economy. In this regard, the prioritization of industrial fixed capital investment is important in terms of determining the future development of the industry. Both micro and macro factors should be taken into account when selecting investment priorities, and areas that are key to improving the country&s competitiveness should be highlighted. Accordingly, priority should be given at two levels: when determining the priority areas of investment, it is necessary to take into account, first of all, the allocation of resources to the processing industry and its basis for the development of other areas. However, the level of development of industries has a significant impact on determining the direction of investment. In order to ensure the effective development of the economy in the country, it is important to have a high-level energy complex, transport system, industrial and agricultural sales system, etc.

The identification and elimination of problems in the competitiveness of the industry and the implementation of measures necessary for the production of products that meet modern requirements make it inevitable

to eliminate many important problems in the medium-term development strategy of the industrial sector. Thus, the development of the industrial sector in the medium term should be formed within the following objectives:

- Production of science-intensive and high-tech, competitive and export-oriented industrial products that meet world standards;

- Expansion of state support for industry;

- Improving the system of state regulation in the field of industry;

- Identify and increase investment sources;

- Achieving sustainable development of industry through the mobilization of natural resources and labor resources;

- Organization of the formation of the infrastructure base necessary for the industrial sector;

- Protection of investment stability, etc [4 p.68].

There is a serious need to develop an industrial development program for the development of industry in the country. Research shows that the development of most industries is impossible without government support. In addition, the development of industry requires the existence and development of related areas. As a result of the creation of related areas and the high level of knowledge and experience of these areas and the high level of risk, the opportunities for entrepreneurs to develop these areas are limited. Therefore, it is necessary to develop an industrial development program that covers a relatively long period and covers complex measures for the development of the industry. One of the important issues in the development of such a program is the correct definition of the industrial development model. These models may differ in the development of the industry based on the creation of private enterprises or the creation of state-owned enterprises or a mixture of them. In this case, the features of the mechanisms provided in the program are different. Therefore, the program should be based on well-defined principles, so that appropriate links can be established with the issues of industrial competitiveness and a comprehensive action mechanism can be put in place.

In order to eliminate the problems in the competitiveness of the country&s industry and identify new areas of competitive advantage, it is very important to increase the level of socio-economic development of the regions and the proper organization of the regional distribution of industry [6 p.80].

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Although the State Programs for Sustainable Socioeconomic Development of the Regions (2004-2008 and 2009-2013) have been implemented to improve the territorial structure of industry, no significant progress has been made in reducing territorial differences across the country. So that. In 2009, the volume of industrial output per capita in the economic regions, excluding Baku, was about 13 times lower than the national average and about 52 times lower than in Baku. This point emphasizes that the territorial structure is one of the priorities in the principles of industrial organization and as a factor to be taken into account in matters of competitiveness. In this regard, it is expedient to apply a cluster approach based on the specialization of individual regions in certain industries [7 p. 13].

It is important to implement the following action plan to stimulate the country&s economy and reduce its dependence on natural resources and bring it to a competitive industrial structure:

1. Preparation of a national economic strategic
2. Strengthen competitiveness by developing a common business environment, supporting a cluster development model, creating competitive regions and establishing effective productive relations with neighboring countries;
3. To diversify the economy by increasing the competitiveness of the industry, turning them into strengths and reducing dependence on natural resources.

The development of a national economic strategy that will serve to ensure the proper achievement of goals, will also determine a common direction of development and intersectoral policies. There are currently uncertainties in the country in terms of overall economic policy and its outcomes.

The development of a national economic strategic plan is one of the most important documents that will ensure the country&s economic integration, both regionally and globally. The economic plan covers the values, locations, and relationships with businesses that businesses need through competitive zones. The economic strategy clarifies the economic space in which the country needs to grow. In order to overcome the legacy of

the Soviet era and ensure the sustainable development of business entities, it is necessary to have a strategic plan that not only addresses the weaknesses, but also ensures integration into the global economy [5 p.73].

Reducing business costs and ensuring management efficiency in the non-oil sector are among the most fundamental measures to be taken in this direction to increase the competitiveness of the industry, make them strong and reduce the dependence on natural resources to diversify the economy [3 p.54].

The role of cluster development is much greater than increasing the country&s competitiveness. The mobilization of companies and the direct attraction of foreign investment in specialized regions will not only ensure the development of the general business sector, but also form the structure of cluster development of the industry.

Given the dominant position of Baku and the Absheron Peninsula in the country&s economy, it should be noted that the geographical diversification of the economy is very important. The most important step in this direction is to develop a strategic plan for economic development at the regional level and to support the relevant plan at the government level. Given that many regions have neighborhoods with foreign countries, it is possible to see the importance of economic relations with neighboring countries. Approaches in this direction, such as the location of transnational companies in the regions and their orientation to the non-oil sector, are of great importance in the future.

Bibliography

1. Z.Abdullayev, Z. Bagirova - "The essence and principles of organization of industry", Baku, 2010
2. T. Huseynov - "Economics of the enterprise", Baku, 2009
3. A. Karpov - "Competitive space of enterprises and industries", Omsk, 2011.
4. B. Ovchinnikov - "Global Competition", Moscow, 2007.
5. М. Porter - "Competition", Moscow, 2005.
6. Kh.Mammadov - "Strategy and scope of enterprise policy", Baku, 2009
country’s industry processing industry enterprises competition economic downturn competitive environment.
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