FINANCIAL SUPPORT OF REGIONAL DEVELOPMENT: ESSENCE, SOURCES, FORMS AND INSTRUMENTS

<jats:p>The article is devoted to a comprehensive theoretical and applied examination of the financial support of regional development, understood as a systemic phenomenon that connects the economic potential of a territory with the strategic goals of state regional policy. The relevance of the topic is determined by several interrelated circumstances that currently shape the environment in which Ukrainian regions and territorial communities operate. The first is the continuing consequences of the decentralisation reform, which substantially expanded the powers and the resource base of local self-government but simultaneously created a pronounced differentiation in the fiscal capacity of communities. The second is the impact of full-scale armed aggression, which has transformed the structure of local budget revenues, redistributed expenditure priorities towards defence and social protection, restricted access to borrowed resources and increased the dependence of many territories on intergovernmental transfers and external assistance. The third is the perspective of post-war reconstruction and European integration, which requires a financing architecture compatible with the principles of the European Union cohesion policy, including multiannual programming, co-financing, additionality and result orientation. The article discusses the conceptual boundaries of the category of financial support and compares the resource-based and the process-based interpretations that prevail in the economic literature. It considers the criteria according to which the sources of financing of regional development may be classified, including ownership, the level at which resources are generated, the degree of stability of receipts and the repayable or non-repayable nature of the funds involved. Considerable attention is devoted to the forms in which financial resources reach regional economic systems, namely self-financing, budgetary financing, lending, investment, grant-based support, and mixed or blended arrangements that combine public and private capital. The instrumental dimension of the problem is also addressed, covering programme-based budgeting, the State Fund for Regional Development, targeted subventions, local borrowing and municipal bond issuance, public-private partnership and concession mechanisms, industrial parks, regional development agencies, participatory budgeting and instruments of guarantee and insurance support. The paper further outlines the methodological difficulties of assessing the effectiveness of financial support, the institutional constraints that limit the use of market-based instruments at the local level, and the questions of coordination between national, regional and donor financing flows. The material is intended to contribute to the discussion on building a balanced and predictable model of financing regional development in Ukraine.</jats:p>