2020 2(39)10

Possibilities for Venture Financing under the Integration of Ukraine into the European Innovation Space

Iryna Lyakh
Head Economist
ORCID https://orcid.org/0000-0003-0568-1549,
Institute of Industrial Economics of the National Academy of Sciences of Ukraine, Kyiv

Citation Format
Lyakh I. I. (2020). Possibilities for Venture Financing under the Integration of Ukraine into the European Innovation Space. Visnyk ekonomichnoi nauky Ukrainy, 2 (39), рр. 75-79. doi: https://doi.org/10.37405/1729-7206.2020.2(39).75-79

Language
Ukrainian

Resume
The paper is devoted to the issue of Ukraine’s integration into the innovation space of the European Union, in which a special role belongs to venture business, which differs from other forms of innovation in terms of capital mobilization, source structure and investment conditions, as well as the use of new financial instruments.
It is argued that the pace of Ukraine’s approaching with the EU in the field of innovation is not satisfactory: there are some positive changes, but many problems have been identified, in particular with venture financing of innovation. An analysis of venture agreements of asset management companies among mutual investment institutions (MIIs) shows that venture funds do not invest in high-tech industries, with the exception of some branches of financial services and ICT. The most common cases of financial support from venture capital in Ukraine relate to such economic activities as: construction, trade, hotel and tourism business, processing of agricultural products, insurance, publishing.
In recent years, there has been a trend of moderate and extensive growth in the Ukrainian asset management sector, mainly due to the activity of new funds. The development of venture capital funds in Ukraine concentrates on the leading regions in measuring their contribution to the country’s economic development. As before, the level of concentration of venture business funds is growing, mainly in the capital and Kyiv region.
The paper substantiates the need and proposes measures to overcome the regional asymmetry in the provision of MIIs financial services, based on strengthening the interaction between mutual investment institutions, on the one hand, and investors and issuers of securities, on the other hand. These measures will help ensure investment efficiency and reduce transaction costs related to this process. To this end, it is important to create an appropriate ecosystem of innovative investment, which will provide access to financial services provided by MIIs to all potential investors in the securities market (citizens and the business community of the country), regardless of regional affiliation.
In recent years, there has been a trend of moderate and extensive growth in the Ukrainian asset management industry, mainly due to the activity of new funds. The development of venture investment funds in Ukraine focuses on the leading regions in terms of contribution to the country’s economic development. As before, the level of concentration of venture industry funds is growing, mainly in the capital and Kyiv region. The article substantiates the need and proposes measures to overcome the regional asymmetry in the provision of CII financial services, based on strengthening the interaction between mutual investment institutions, on the one hand, and investors and issuers of securities, on the other hand, which will help ensure investment efficiency and reduce related to this process transaction costs. To this end, it is important to create an appropriate ecosystem of innovative investment, which will provide access to financial services provided by CII to all potential investors in the securities market (citizens and the business community of the country), regardless of regional affiliation.

Keywords
European innovation space, integration, venture financing, mutual investment institutions, regional asymmetry, innovation ecosystem.

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