Konyushenko Y., Skill N. A.

Oles Honchar Dnipropetrovsk National University

TRANSNATIONAL CORPORATIONS IN UKRAINE

At the present stage of development of the world economic system, transnational corporations (TNCs) have become one of the key driving forces of globalization.

The arriving of multinational corporations in a particular country and entering the national companies foreign trade and financial markets is called "trans-nationalization" of the economy. It is important that foreign direct investments (FDI) is the main way of expanding the influence of TNCs on the national economy, and the way to build national corporations themselves. According to UNCTAD, in 2011 in Ukraine there were more than 360 foreign branches of TNCs, whereas this figure is much higher than in the EU (there are more than 208 thousand foreign branches)

In the first quarter of 2012 the volume of capital investment increased by 23.2%, almost twice as much as in the first quarter of 2011 – 13.2%, innforms "Kommersant-Ukraine." Totally it has been invested 48.1 billion UAH. Most of the growth was provided by the field of trade (53.3%), hotel and restaurant business (52.6%), transport and communications (51.9%), construction (40.3%). Lower rates showed the investments in the financial sector (+23.7%) and real estate (23.2%). The difficult situation was observed in the manufacturing industry (-3.2%) and public sector (education -9.2%). Investments came from 128 countries. Ten main countries, accounting for more than 83% of the total foreign direct investments are the folloving: Cyprus – $ 12.7 billion, Germany – $ 7.4 billion, the Netherlands – $ 4.8 billion Russia – $ 3.6 billion, Austria – $ 3.4 billion, UK. – $ 2.5 billion, France – $ 2.2 billion, Sweden – $ 1.74 billion, Virgin Islands (British) – $ 1.6 billion, and the U.S. – $ 1.0 billion.

However, the national economy is still very attractive to foreign investors. Ukraine (for example, in terms of GDP), is the second after Russia (in the former Soviet Union territory) in absolute indicators. Ukraine is characterized by a highly developed metallurgy, chemical and heavy industry, and all these characteristics are the basis of its competitiveness in the world markets. Ukraine is characterized by the development of agriculture, which provides a significant share of national exports.

Most of the multinationals which are presented in the Ukrainian market are specialized in the food industry and trade. These branches provide rapid circulation of capital and low commercial risks. Large industrial concerns, such as, Westinghouse, Exxon Mobil, are absent in Ukraine,with the exception of Mittal Steel.

The influence of TNCs on Ukrainian enterprises must also be assessed from the positive and negative sideA positive feature of their activity is the revival of competition and the quality of domestic products improvement. TNCs play an important role in promoting international standards in production of goods and services and the training qualified staff. All of this leads to the productivity growth. Their work makes domestic firms invest in developing new technologies to reduce costs and to compete for the consumer. The negative feature is the reducing of output or closing of domestic enterprises which can not compete with powerful multinationals in volume of capital.

As for Ukrainian consumers, the iinfluance of TNCs on welfare is also measured ambiguously. On the one hand – saturation of the market with various goods and services. On the other hand – TNCs in the Ukrainian economy are mainly oriented to the creation of distribution networks, promoting their products at the Ukrainian market..

The creation of the Russian-Ukrainian "Transnational aluminum company" and "International aircraft engines", corporations for the production of titanium and titanium mill products and trucks is being discussed now. Russian "Gazprom" and Khartsyzsk Tubes have created "Steel-pipe-gas" concern.

However, the establishment of the Ukrainian TNCs, despite the suitable legal basis, is at an early phase, while the process of creating such a structure in Russia becomes significant.

Thus, the creation of Ukrainian TNC will helps to:

• Protect national economic interests;

• promote the further development of Ukrainian economic structures, the inter­natio­nalization of production and the capital of Ukraine integration into the world economy, and its participation in global and transformational processes.

• facilitate the introduction of new technologies and allow the production moderni­zation;

• provide employment for the local population, with the increasing of wages and improving social welfare of workers, raising the skills of workers and the general level of education in the country;

• facilitate the connection of domestic producers to the international division of labour.

Creating of Ukrainian TNC will protect the national economic interest and will promote further development of Ukrainian economic structures and internationalization of production and capital, integration of Ukraine into the world economy.

It is advisable for Ukrainian state policy to take advantages of ransnationalization of the economy , with protection of domestic producers in certain sectors, and the creation of conditions for the entering Ukrainian companies the foreign market .