Possibilities to Stimulate the Innovative Development of the Economy Through the Financial System in the Republic of Armenia

Abstract

The article is devoted to the study of methods and mechanisms for increasing the efficiency of financing innovative activities through the financial system of the Republic of Armenia, the factors, that determine their effective use, the possibilities of using the "long money" of commercial banks, pension funds, insurance companies and the securities market of the Republic of Armenia, as well as the possibilities of modernizing the functions of the Central bank in the context of stimulating the innovative development of the economy. Obviously, in the current geopolitical and economic conditions, it is desirable to maximize the investment resources of accumulative pension funds in the Republic of Armenia, creating a reserve of "long money", which will stimulate innovation and investment activities, as well as contribute to the development of the capital market. The latter, in turn, will lead to lower interest rates on loans and increase the availability of funding sources. In this case, it is especially important to create in the RA branches of innovative production companies owned by Armenians of the Diaspora and other entrepreneurs, create demand for their innovative products through government orders, and also, to the maximum extent possible, direct the investment resources available in all parts of the financial system to these companies. The presented approach will provide an opportunity to promote the innovative development of the economy, create additional jobs, increase tax revenues to the state budget, increase the competitiveness of Armenian companies in the world market, as well as effectively manage investment risks and ensure transparency in the use of financial resources. Based on the example of the Republic of Armenia, the article discusses the fundamental issues related to ensuring the availability of financing for innovative activities through the links of the financial system, and develops some mechanisms for financing innovative activities.