BUILDING THE COUNTRY’S INVESTMENT ATTRACTIVENESS IN THE CONTEXT OF ECONOMIC CLUSTERS AS A DRIVING FACTOR IN FOSTERING CROSS-BORDER PARTNERSHIPS

Abstract

In market realia, the ultimate purpose for starting any organization, including transnational clusters, is to gain optimum return on financial investments. Currently, boosting investment in transnational clusters in effect depends mainly on the participants in this cluster. Thus, the issues of finding pathways to control the profitability and competitiveness against the financial and business performance of transnational clusters come within the competence of the top management of participating businesses. In this context, good management practices provide the framework for creating positive image of domestic enterprises and their investment attractiveness. The paper offers an overview of economic, legal and institutional premises to foster cross-border partnerships in terms of building an overall country’s investment attractiveness. The aim of this study is to identify the factors affecting investment attractiveness of Ukraine through the development of cross-border economic clusters and implementing international economic partnership projects with shifting a focus towards investing in innovation. The methods of system analysis and synthesis, logical structured analysis and scientific justification have been employed. The paper explores the investment climate of the European Union using the case studies from Estonia and the Czech Republic along with revealing the role of transnational economic clusters in building a country’s investment attractiveness and providing insights on legal framework regulating cross-border partnerships. The findings expand understanding of cross-border cluster development capacities. An emphasis is put on the need for more extensive application of intellectual and innovative potential of domestic cluster participants. It is argued that under cluster creation and functioning it is critical to change a vector towards achieving higher efficiency, quality assurance, greater profits and competitiveness of domestic businesses. A range of government programs focused on attracting international investment, in particular, the ones promoting the development of cross-border clusters have been discussed.