Investments and their role in economic development

Investing - the term on everyone's lips in the past two decades. But is a relatively new word for our economy. In Soviet times, only one used the term "capital expenditure", which refers to all costs of reproduction of fixed assets, including the cost to repair them. In the scientific literature, these two concepts in recent years are treated differently . Traditionally, investment is understood as the exercise of certain development projects in the present, with the expectation to receive income in the future. This approach to understanding the investment is predominant, both in domestic and foreign economic literature. In the RF Law "On Investment Activity in the Russian Federation carried out in form of capital investments »№ 39-FZ of February 25, 1999, defines an investment:" ... investments - cash, securities, other property, including property rights, other rights, which have monetary value, invested in facilities business and (or) other activity for profit, and (or) achieving another beneficial effect. "Investments - is a broader concept than capital investments. Investments are generally classified as portfolio and real. Portfolio (financial) investments - are investments in shares , bonds, other securities, the assets of other companies. Real investments - investments in the creation of new, reconstruction and modernization of existing enterprises. In this case, institutional investor, investing, increasing its productive capital - the basic production assets and the necessary working capital for their operation means. In the implementation of portfolio investment, the investor increases its financial capital to yield dividends - income securities. The RF Law "On Investment Activity in the Russian Federation carried out in the form of capital investment," the concept of "capital investment" is interpreted as follows: "... capital investments - investments in fixed assets (fixed assets), including the cost of new construction, expansion, reconstruction and modernization of existing businesses, acquisition of machinery, equipment, tools, equipment, design work and other costs" . Based on this definition, the investments in working capital, can not be regarded as capital investments. If we argue from positions in production more specifically, the capital investments - at cost: construction works for the construction of buildings, purchase, installation and commissioning of machinery and equipment, design work, content management enterprise under construction, personnel training and retraining, the cost of allotment of land and resettlement in connection with construction, etc. The statistical accounting and economic analysis of real investment is also called kapitaloobrazuyuschimi. Kapitaloobrazuyuschie investments include the following elements: investment in fixed capital costs of major repairs, investments in the acquisition of land and natural resources, investments in intangible assets (patents, licenses, software, research and development activities, etc. etc. ), investments in replenishment of inventories. The main place in the occupied kapitaloobrazuyuschih investment in fixed capital investment, in which the amount includes the cost of new construction, reconstruction, expansion and modernization of existing industrial, agricultural, transport, trade and other enterprises, the costs for housing, cultural and residential buildings. Investments as an economic category perform several important functions without which normal development of the economy of any state. Investing at the macro level are the basis for: the implementation of the policy of expanded reproduction, accelerating scientific and technological progress, improving the quality and competitiveness of domestic products, the restructuring of social production and balanced development of all sectors of the economy, creation of necessary raw materials industry, civil construction, development, health, culture, higher and secondary schools, as well as solving other social problems, mitigate or solve the problem of unemployment, environmental protection; conversion of the military-industrial complex, state defense and security solutions to many other problems. The economy of the Russian Federation, which has long been in a state of economic crisis, investment is needed primarily for its stabilization, revitalization and expansion. Thus, the investments determine economic growth. The increase in real capital of the company (purchase of machinery, equipment, modernization and construction of buildings, engineering structures) increases the productive capacity of the economy. Investments in production, new technologies help to survive the fierce competition (both domestic and foreign markets ), allow more flexible regulation of prices for their products and so influencing the expansion of productive capacity in the long term investments have a significant impact on the use of existing facilities. Investments play a crucial role at the micro level. At this level, they are necessary, First of all, to achieve the following objectives: expansion and development of production to avoid undue moral and physical depreciation of capital assets, raising the technological level of production, improve the quality and competitiveness of individual enterprises, environmental activities, the acquisition of securities and investing in the assets of other enterprises . In the end they are necessary to ensure the normal functioning of the enterprise in the future, stable financial position and profit maximization. Thus, the investments are an important economic category and play a significant role at both the macro and micro level, especially for simple and expanded reproduction of structural reforms, maximize profits and on this basis, the solution of many social problems. But because of general economic instability, high inflation, high interest rates on loans that exceed the level of profitability of enterprises in recent years, the volume of capital investments and capital construction fell sharply, that did not help, but rather aggravated the economic situation of the country. The state investment in a country characterized by the dynamics of the following indicators: total investment, the share of investment in gross domestic product (GDP), real investment share in total investment; the total amount of real investment, the share of real investment in the capital, and others indirectly, but quite objectively, state investment is characterized by growth rates of key macroeconomic indicators such as national income, GDP and GNP, industrial production, the production of certain critical industrial products, agricultural production, productivity of social labor, and others. The objectivity of these indicators in the evaluation of investment due to the fact that their growth is impossible without investment. These figures to some extent, characterize the efficiency of investment. So if the growth rates of these performance outpaced the growth in investment, it is a clear sign of efficiency investments, and vice versa.