Financial support of investment activity of dairy industry enterprises

Abstract

Introduction. Activation of investment activity of the dairy industry enterprises is important prerequisite to the improvement of their competitiveness in terms of increasing foreign manufactured products in the domestic market and in terms of decreasing the level of people's income in the country. In addition, the reasonable choice of investments and effective investment management are essential for the development of enterprises, for the improvement of their material and technical and resource bases. The choice of of investees and management of the investment projects require searching of necessary financial resources.

Purpose of the study is to analyze the main sources of financing of the investment projects of dairy industry enterprises.

Method (methodology). Analysis, synthesis, generalization, and descriptive method have been used in the course of the study.

Results. In the current conditions of the dairy industry selection of investment projects is limited by the available financial resources. The situation is caused by annual net losses during the analyzed decennial period. As for the dairy industry enterprises we have to stress upon the situation that approximately half of them have worked ineffective and they cannot finance the investment projects at own expense. In the structure of the balance borrowed funds dominate. The enterprises use mostly external resources for financing of their investment projects. It has been determined that level of loan interest rates usage of credit and leasing for many enterprises is inefficient. Highly profitable investment projects can be an exception. Under these conditions, foreign direct investment is important source of funding. It has been also proved that the dairy industry enterprises must solve a number of problems, including problems in the management system.