FINANCIAL INSTRUMENTS OF THE STATE POLICY FOR THE PREVENTION OF TERRORIST ACTS IN UKRAINE

• Main Author: Mykola Bunchuk
• Format: Article
• Language: English
• Published: Izdevnieciba “Baltija Publishing” 2017-11-01
• Series: Baltic Journal of Economic Studies
• Subjects: money laundering; state anti-terrorism policy; policy instruments; financial and economic mechanism; terrorism financing
• Online Access: http://www.baltijapublishing.lv/index.php/issue/article/view/153/160

The article’s objective is to determine the mechanism for implementing the financial instruments of the state policy to counter terrorist acts in the territory not controlled by Ukrainian authorities in Donetsk and Luhansk regions. Methodology. Within the scientific research, for the most effective approaches at the national level to prevent the threat of international terrorism, under the conditions of the deep internal political crisis and extremely difficult economic situation, in order to improve the efficiency of public administration in developing and implementing the anti-terrorism state policies in Ukraine, the paper analyses international and domestic regulations on preventing the terrorist financing, considers factors that affect the deterioration of the social and economic situation of the temporarily occupied parts of Donbas. Results of the research allow formulating the definition of financial instruments of antiterrorist policies, the paper develops and proposes a series of organizational measures in order to prevent the terrorist financing in Ukraine. Practical implications. Based on the above, we propose an option of classification of main illegal mechanisms that may be used to finance terrorist activities in the territories of Donetsk and Luhansk regions uncontrolled by Ukrainian authorities, dividing them into internal and external. Given the above studied factors and classification of financing of terrorist acts in eastern Ukraine, we can assume that for the purpose of evading duty payable to relevant state bodies of Ukraine, external supplies of inventories in the uncontrolled areas of the Donetsk region, which are later obtained by illegal armed groups, are possibly carried out as follows: on behalf of a commercial entity registered in a foreign country for the Ukrainian commercial entity, registered in settlements located in the uncontrolled territory; crossing of international transit traffic that moves through the Russian Federation checkpoints of the Ukrainian-Russian border on the uncontrolled Ukrainian territory. Value/originality. We have concluded that the introduction of financial instruments of the state policy to counter terrorism will bring the following positive results: ensure systematic implementation of the state policy in the prevention and counteraction to legalization (laundering) of proceeds from crime or terrorist financing; enhance a compliance of the national system of combating legalization (laundering) of proceeds from crime or terrorism financing with the international legal standards; improve inflow of foreign investment in order to stimulate the national economy. However, the effectiveness of the above measures should be determined in accordance with the principles of economic analysis of the state policy.