Baltic Journal of Economic Studies 206 Vol. 9 No. 5, 2023 This is an Open Access article, distributed under the terms of the Creative Commons Attribution CC BY 4.0 1 Kauno kolegija Higher Education Institution, Republic of Lithuania (corresponding author) E-mail: olena.parkhom@gmail.com ORCID: https://orcid.org/0000-0002-6492-6836 ResearcherID: Q-9059-2016 2 Simon Kuznets Kharkiv National University of Economics, Ukraine E-mail: iarmosh@hneu.net ORCID: https://orcid.org/0000-0002-2943-596X ResearcherID: AAN-5869-2020 DOI: https://doi.org/10.30525/2256-0742/2023-9-5-206-214 PROVISION OF GLOBAL SUSTAINABLE DEVELOPMENT AS A FACTOR IN THE FORMATION OF LOCAL WELFARE Olena Parkhomenko1, Olena Iarmosh2 Abstract. The subject of the article is the problem of ensuring the welfare of the population in the context of achieving the goals of sustainable development. The authors define the concepts of "sustainable development", "hromadas" (territorial communities), "welfare", and systematise the prerequisites for the formation of welfare at the local level. The paper aims at developing approaches to determining the priority tasks of territorial development in the system of sustainable development goals. It is noted that sustainable development is impossible without achieving a certain level of welfare. To achieve the research goal, the authors analyses and assesses the level of welfare of hromadas, and also considers a set of indicators for assessing welfare based on a combination of "hard" (objective) and "soft" (subjective) factors. The methodology for assessing the welfare of territories (on the example of Ukraine) and studying its impact on the level of sustainable development of the country is applied. The methodology is based on the construction of a non-linear regression model, which demonstrates the high significance of the factors "number of educational institutions" and "number of cultural and sports institutions". The publication also identifies the main reasons that, according to the respondents, impede the development of hromadas in the region under study: poor quality of education; insufficient public initiative and activity of residents; lack of opportunities for self-realisation and meaningful leisure; poor quality (lack of ) road surfaces; unemployment; spread of crime, alcoholism, corruption; environmental pollution; drinking water pollution; deterioration of engineering networks; population ageing; lack of investment; lack of entrepreneurship of hromada residents; lack of hromada awareness; unfavourable conditions for business development. The conclusion of the research is that local and regional plans should provide a systematic vision of territorial development and define strategies based on an integrated and multidimensional approach to inclusive and sustainable development. They should be defined, implemented and monitored with the involvement of key territorial stakeholders in the governance process. Based on the analysis, recommendations will be made to identify territorial development priorities in the system of sustainable development goals at local and global levels. In particular, to establish local priorities, existing local and regional programmes should be reviewed to identify the main needs, priorities, gaps and cross-sectoral linkages of the territory and their relationship with the SDGs and national priorities. Key words: sustainable development, welfare, sustainable development goals, hromada, welfare assessment, territorial development. JEL Classification: O18, R13, R58 1. Introduction Today, the problem of sustainable development of countries and regions is receiving a great deal of attention, as there is an awareness in the global environment that human activity should be directed not only towards meeting the needs of the present, but also the needs of future generations. This has led to the development of the concept of sustainable development and the introduction of management practices that harmoniously combine the economic, social and environmental impacts of the environment on society in both global and local dimensions. According to the UN, sustainable development is the development of societies that meets the needs Baltic Journal of Economic Studies 207 Vol. 9 No. 5, 2023 of the present without compromising the ability of future generations to meet their own needs (2030 Agenda for Sustainable Development). The idea of sustainable development was the basis of the global programme of the action "Agenda for the XXI century", adopted by 179 countries of the world. Among them was Ukraine, which also declared its desire to move towards sustainable development. Within each country, the question arises as to who will be responsible for achieving the indicators set out in the Sustainable Development Goals. It is equally important to focus on the overall achievement of such indicators, which can generally be reflected in a category such as "welfare". The idea of decentralisation of public power is implemented in one form or another in most developed countries of the world. As a result of decentralisation, the efficiency of public power in general has been raised to a qualitatively new level in many democracies. In fact, the processes of decentralisation and reform of self-government in Ukraine have transferred responsibility for the development of local territories to newly created hromadas. Therefore, not only the development and prosperity of individual territories, but also the welfare of the entire country depends on the professionalism and systematic actions of hromada representatives. The aim of this paper is to assess the welfare of hromadas (on the example of Ukraine) and to study its impact on the level of sustainable development of the country. In this regard, the task is to consider the relationship between such categories as "welfare", "hromada" and "sustainable development". 2. Hromadas as a Social Phenomenon Before proceeding to clarify the essence of welfare, it is worth considering the approaches to its definition and the main features of hromadas' activities on the example of Ukraine. A modern community is a collaborative grouping based on new forms of belonging. One can belong to several communities based on religion, nationality, ethnicity, lifestyle and gender. In addition, a hromada is not only a group of citizens living in a certain territory, but also all the ties that unite them and form a social structure that includes the following elements: an elected body (decision-making body), a mayor as a representative of the executive branch; other auxiliary self-government units in accordance with the hromada's charter. There is no better way to strengthen the capacity of hromadas than through partnership. The understanding of the concept of community has changed over time under the influence of important social, cultural and political factors. Therefore, today there are many variants of interpretation of approaches to defining the essence of communities, in particular: 1. A community is a geographically-based group of people who share common social, cultural and economic interests and believe that they are part of a whole (Bashshur, Shannon, 2009). 2. A community is a set of people who live in a certain geographical area, share common interests or activities, and have a cultural brand of identity (Littlejohn, Foss, 2009, p. 143). 3. A community is a new form of social connection and belonging where people come together and have different connections to different communities (Delanty, 2010). If to summarise the achievements of modern science in the field of territorial community research, the list of the main features of the latter can be grouped as follows: – Common territory of existence (which may include living, working, owning real estate); – common interests in solving life challenges; – social interaction in the process of realising these interests; – psychological self-identification of each member with the community; – shared communal property; – payment of utility taxes. In general, it should be emphasised that adminis- trative and financial decentralisation is a complex and a priori ambiguous process for the development of a country's socio-economic system (especially in the short and medium term), as evidenced by both basic theoretical concepts and the experience of countries that have implemented this type of reform (Kravtsiv, 2020). 3. Welfare as a Socio-Economic Category The welfare of each citizen, family, and hromada as a whole is the product of many, often interrelated factors, and understanding their impact is important for determining the competitiveness of hromadas and ways to improve their performance. The article (Ruggeri, Garcia-Garzon & Maguire et al. 2020) notes that welfare is not just happiness, satisfaction or an economic indicator. This apt phrase further emphasises the complexity, intricacy and unpredic-tability of defining the phenomenon of welfare. The meaning of welfare has changed over time. The Greek philosopher Plato defined welfare as a factor of land that can feed one person. Aristotle understood that welfare is not the good one seeks, but is useful in the search for something else. Ancient Chinese thinkers believed that welfare is the satisfaction of a level of consumption that corresponds to a person's Baltic Journal of Economic Studies 208 Vol. 9 No. 5, 2023 status. The founder of political economy, Adam Smith, believed that welfare is based on the growth of social welfare, i.e., the amount of national income per capita (Tarasevich and Petruni, 2013). Welfare characterises the outcome of practical solutions to questions of morality, compromise and state competence. There are some critical aspects of the welfare model: risk and innovation, intergenerational risk sharing, social solidarity and justice, life-cycle support, preferences (Stiglitz, 2015). Welfare includes: a sufficient length of healthy life (supported by quality health services and safety); an acceptable level of consumption of goods and services; knowledge of the world and development; satisfactory relationships, absence of conflict and threats to the level of welfare achieved; and access to knowledge, education and cultural values that shape identity. In particular, this includes taking into account the views of the individual in solving problems, participation in creating a common picture of the world and rules of human behaviour; social belonging, full participation in all aspects of life; access to various information, including on the state of affairs in hromadas; comfortable working conditions that provide space for creativity and self-realisation. Thus, the leading factors in the welfare of hromadas are the level (degree of satisfaction of personal needs for material and spiritual goods) and quality of life (degree of satisfaction of a set of socio-economic needs). Thus, the leading factors in the welfare of hromadas are the level (degree of satisfaction of personal needs for material and spiritual goods) and quality of life (degree of satisfaction of a set of socio- economic needs). Welfare is defined as a complex indicator that includes: material standards of living (income, consumption and well-being); health; education; personal interests and activities, including work; the right to political voice and participation in governance; social ties and relationships; the environment (current and future state); and security (both in the economic and physical sense). Welfare has certain elements, which are shown in Figure 1. When welfare is described as a socio-economic category, its characteristics should be noted. Firstly, welfare is a very broad and multifaceted concept, covering all spheres of society and having two sides: objective and subjective. The objective side is based on scientifically sound standards of the needs and interests of the population, which make it possible to objectively assess the degree of satisfaction of these needs and interests. People's needs and interests are very individual, they exist only in people's minds, in their thoughts and judgements. They are not taken into account by any statistics and are a subjective aspect of people's satisfaction with their own welfare. Secondly, welfare includes other socio-economic categories in qualitative terms. For example, the description of the quality of working life cannot be limited to indicators of employment, unemployment, length of working day, week, year, level of occupational accidents. It is necessary to assess the degree to which the interests of employees are met, the type of work, its intensity, content, team relations. 4. Hromadas' Welfare as a Component of the Country's Sustainable Development The Sustainable Development Goals are an internationally accepted call to action to equalise the welfare of people in different communities, countries and regions and to ensure their continued growth without negative impacts on others. AAt the same time, the central object of the state economy should be a person. Reliable work and decent wages should satisfy all human needs in order to achieve adequate indicators of the level and quality of life (welfare). As can be seen, the level of welfare is directly related Pr er eq ui si te s f or th e w el l-b ei ng of h ro m ad as Needs Environment Long-term values: long life, good health, procreation, strong family, high intelligence, material wealth, social security, high level of culture, spiritual values Current values: physiological needs for goods and services (consumption), need for housing, need for personal security Habitat (physical): air, water, land, forests and toxic waste Social infrastructure (social): healthcare and recreation, science and education, trade, catering and consumer services, culture and arts, physical culture and sports Figure 1. Prerequisites for the formation of hromada welfare Source: compiled by the authors on the basis of (Rodchenko, 2017) Baltic Journal of Economic Studies 209 Vol. 9 No. 5, 2023 to sustainable development and is an important indicator of its achievement. Currently, there is no single model for assessing the welfare indicators of a particular community or country. Figure 2 shows the most commonly used methods of assessing the welfare of the population in global studies. Among other approaches to assessing the welfare indicator, it is worth mentioning the assessment People-oriented Economically oriented Complex methods Human Development Index (HDI) Human Economic Welfare Index (HEWI) World Happiness Index (WHI) Index of Sustainable Economic Welfare (ISEW) Sustainable Measure of Economic Welfare (SMEW) World Prosperity Index (WPI) Genuine Progress Indicator (GPI) Weighted Index of Social Indicators (WISI) Figure 2. Methods for assessing the welfare of the population Source: compiled by the authors on the basis of (Tomaselli, 2021; UNDP; Wellbeing Survey) Ecological integrity Economic security Rule of law ge ne ra l i nf or m at io n ab ou t t he re gi on /c ity /v ill ag e/ se ttl em en t: br ie f hi st or y of th e ar ea , p op ul at io n, to ta l ar ea , g eo gr ap hi ca l l oc at io n, tr an sp or t lin ks a nd in fr as tru ct ur e Social welfare in fo rm at io n on c ur re nt pr og ra m m es o f s oc io -e co no m ic de ve lo pm en t a nd in di vi du al te rr ito rie s, re po rts o n th ei r im pl em en ta tio n na tu ra l r es ou rc e po te nt ia l, in cl ud in g cl im at ic c on di tio ns re su lts o f s oc io lo gi ca l s ur ve ys on re si de nt s' op in io ns , l ik el y de ve lo pm en t s ce na rio s, an d de si re fo r i nn ov at io n bu si ne ss a ct iv ity in th e ar ea : e xi st in g pu bl ic a nd p riv at e en te rp ris es , l iv in g st an da rd s a nd e m pl oy m en t in fo rm at io n on e xi st in g ci vi c or ga ni sa tio ns , b od ie s o f s el f- or ga ni sa tio n of th e po pu la tio n, th e le ve l o f c oo pe ra tio n be tw ee n th e au th or iti es a nd ci vi c or ga ni sa tio ns in fo rm at io n on th e hi st or ic al an d cu ltu ra l s itu at io n (m us eu m s, m on um en ts , e tc .) In te rn at io na l r el at io ns o f t he re gi on /c ity /v ill ag e/ se ttl em en t, pa rti ci pa tio n in in te rn at io na l pr oj ec ts ot he r i nf or m at io n fo r g en er al u se HROMADAS' ADHERENCE TO THE PRINCIPLES OF SUSTAINABLE DEVELOPMENT ge ne ra l p la n fo r t he de ve lo pm en t o f t he te rr ito ry , ci ty d ev el op m en t p la n pe cu lia rit ie s o fs oc io -e co no m ic de ve lo pm en t i n th e dy na m ic s (a cc or di ng to th e St at e St at is tic s Se rv ic e of U kr ai ne , l oc al au th or iti es ) th e st at e of th e ci ty 's so ci al in fr as tru ct ur e: th e sy st em o f ed uc at io na l, cu ltu ra l, sp or ts fa ci lit ie s, pa rk s, et c. Figure 3. Assessment of the hromada's compliance with the SDGs Source: compiled by the authors on the basis of (Methodological Recommendations for the Consideration of the Sustainable Development Goals in the Development Strategies of the Territorial Communities; Anand, 2017) Baltic Journal of Economic Studies 210 Vol. 9 No. 5, 2023 methodology developed in 2005 by the Economist Intelligence Group in the United States, which links the results of a survey of subjective assessments of life satisfaction with objective determinants of welfare (The Economist Intelligence Unit). In assessing welfare for the OECD, Boarini used a similar classification scheme into three categories: monetary measures of economic resources; measures that reflect selected social conditions; subjective indicators of happiness and life satisfaction (Boarini, Johansson, & Mira, 2006). A similar objective approach has been proposed by Keune, who distinguishes the following indicators of the welfare of hromadas (Keune, Elzinga & Ruyter 2006). In a review of existing alternative measures carried out for the European Parliament, Goossens classified indicators according to their main objectives (Goossens, Makipaa, & Schepelmann, 2007). The Research Department of the University of Toronto in Canada presents its study of the main factors of welfare, dividing them into three groups: being (physical, psychological, spiritual), belonging (physical and social belonging, belonging to the community) and becoming (practical and recreational becoming, becoming of growth). Shortly after the adoption of the Sustainable Development Goals as a benchmark for all countries, Ukraine prepared methodological recommendations for integrating the Sustainable Development Goals into hromadas' development strategies within the framework of the UNDP/GEF project "Integration of the Rio Conventions into the National Policy of Ukraine", which outlined the main components for analysis that should be covered in a sustainable development strategy and presented in the form of a hromada profile. The guidelines also include an assessment of a hromada's compliance with the principles of sustainable development. Figure 3 systematises the approaches to assessing the compliance of hromadas with the SDGs. 5. Assessment of the Level of Welfare of Hromadas Achieving the welfare of hromadas is a priority objective of the social market economy. Hromadas are moving from being objects to becoming subjects of management, which makes them leaders of change, responsible for planning their sustainable development, local economic growth, spatial planning and the preservation of the environment of the territory under their control. Thus, due to the new realities of life, such as decentralisation of power (amalgamated hromadas), the solution of the problems of state regulation as a function of managing the welfare of hromadas is changing. International experience shows that regional, economic, social and political problems are best understood and effectively addressed only at the local level. It is possible to develop approaches to assessing the welfare of hromadas: 1. Measurement the welfare of hromadas through public welfare, measured by the current state and dynamics of GNP. 2. Identification of the level of welfare of hromadas through the composition and size of needs for various vital goods (food, clothing, housing, transport, utilities and household services, education, healthcare, cultural and educational activities), as well as the possibility of meeting them based on the supply of goods and services and real incomes of the population. 3. Determination of the quality of the development of the welfare of hromadas (the degree to which conditions and living standards meet certain standards) using assessment methods (indices) that measure the result of the provision of benefits for human capital. To determine the priority steps to improve and maintain the level of welfare, the authors of the study assessed the level of welfare of 10 hromadas in one of the largest regions of Ukraine. The study was conducted in 2021 based on the results of 2020 and included the processing of statistical information, as well as the results of surveys of residents, business representatives and authorities of the hromadas selected for the study. In order to analyse and assess the level of welfare of hromadas in the context of state regulation as a management function, a set of welfare indicators based on a combination of hard (objective) and soft (subjective) factors that influence life satisfaction (socio-economic, demographic, legal, political, cultural and psychological) was considered. Table 1 shows the objective and subjective factors used in the study. After selecting the coefficients, analysing statistical sources and conducting a survey, the assessment was carried out in several stages. At the first stage, in order to obtain a generalised comprehensive rating assessment, various factor indicators characterising the final results and efficiency of the activities of hromadas were consolidated into a single (integral) indicator Rj, which was chosen as the indicator of hromadas' welfare. The method used is the distance method, which is based on determining the degree of proximity of hromadas in terms of comparable indicators to the reference hromada, i.e., the hromada with the highest values of the studied indicators. The calculation of the integral indicator Rj is based on the formula for the Euclidean distance from the reference point to the point corresponding to the object under evaluation. Baltic Journal of Economic Studies 211 Vol. 9 No. 5, 2023 The generalised rating assessment made it possible to identify the hromadas with the highest rating. At the second stage, all possible combinations of correlation coefficients between the resultant and factor indicators (X) are calculated. The calculations have shown that almost all factor indicators have a greater or lesser impact on the welfare of the population of hromadas. A high direct correlation (0.7-1) is observed for such factor indicators as population density (Х1), number of settlements (Х3), educational institutions (Х5), cultural and sports institutions (Х6), medical institutions (Х7), as well as improvement of the environment (Х13), roads and transport links (Х14), security (Х17), which increase the welfare of the population of hromadas. The number of enterprises (Х8), assessment of educational services (Х12), provision of medical services and social protection (Х15), human relations (Х20), landscaping (Х21), water supply and sewerage (Х22) indirectly affect the welfare of the population of hromadas. Indirect feedback is provided by the assessment of employment opportunities and entrepreneurship development (Х18), the state of the political and legal spheres (Х19), and the comfort of living of hromada residents (Х25). The factor indicator of average monthly salary (Х4) has a direct moderate relationship, as well as a moderate inverse relationship with the assessment of income and employment (Х11) and the level of satisfaction of needs in the field of culture, recreation and leisure (Х16). At the third stage, assuming the existence of a stochastic dependence of the resulting indicator of welfare R on the factors of the number of educational institutions (X5) and the number of cultural and sports institutions (X6), a nonlinear two-factor regression was obtained: R = a ⋅ x1 b1 ⋅ x2 b2, where x1 is the number of educational institutions (Х5), and x2 is the number of cultural and sports institutions (Х6). The basis for considering this type of dependency is the results of observations made in the work of the famous scientist Richard E. Nisbett (2015), which confirms the idea of the importance of the education of the population to ensure the welfare of the country. As an example, he cites the experience of Ireland, where a well-organised and very successful attempt was made to improve the education system, especially in the upper classes of high schools, vocational schools and colleges (Cheney, 2006). In a short space of time, the number of university entrants in the country increased by 50% (Heraty, Michael, McCarthy 2000). In about 30 years, the level of GDP per capita in Ireland, where IQ scores were much lower than in England, has exceeded the level of GDP per capita in England. Thus, as the mental level of the population rises, it becomes richer, as more advanced and highly organised ways of achieving prosperity become available to people. Hence, based on the correlation analysis carried out in the first stage and the above observations, a calculation was carried out to find the analytical form of the dependence. The MathCad programme Table 1 Factors of hromada’s welfare Objective factors of hromadas' welfare Symbol Subjective factors of hromadas' welfare Symbol Population, persons Hromada's budget revenues, thousand UAH Number of settlements included in the hromada, units Average monthly salary of full-time employees, UAH Number of educational institutions, units Number of cultural and sports institutions, units Number of medical institutions, units Number of agricultural and industrial enterprises, units Length of highways, sq.km X1 X2 X3 X4 X5 X6 X7 X8 X9 Satisfaction with living standards Income and employment levels Level of educational services State of the environment Condition of roads and transport links Quality of medical services and social protection of the population Level of satisfaction of needs in the field of culture, recreation and leisure Safety in public places Employment and business opportunities State of political and legal spheres Quality of human relations The level of landscaping State of water supply and sewerage Quality of food products Quality of social services Comfort of living in the hromada Living standards of hromada residents Involvement of residents in hromada management X10 X11 X12 X13 X14 X15 X16 X17 X18 X19 X20 X21 X22 X23 X24 X25 X26 X27 Baltic Journal of Economic Studies 212 Vol. 9 No. 5, 2023 was used to calculate the coefficients of the model. As a result, the following was obtained: R = 2.518 ⋅ x10.021 ⋅ x20.111. The adequacy of the built regression model to the statistical data was assessed by the Fisher- Snedeker criterion. According to the results of the calculations, the calculated value is greater than the tabulated value at the level of confidence. Thus, it can be concluded that the regression equation is significant, i.e., the hypothesis of the significance of the relationship between the dependent (R) and explanatory (X5, X6) variables is confirmed. The selected factors (Х5, Х6) explain the change in the indicator quite well and the model is adequate to the statistical data, i.e., it can be used, for example, for forecasting. In addition, it can be analysed using partial elasticity coefficients. For example, if a factor changes X5 by 1%, the indicator will change by only 0.02% if X6 remains unchanged; similarly, the indicator will change by 0.11% if X6 changes by 1% if X5 remains unchanged. 6. Identification of Territorial Development Priorities in the System of SDGs From a practical point of view, the results of the survey are important. Thus, the main reasons that, according to the residents, hinder the development of the hromadas in the study region were identified: low quality of education; insufficient public initiative and activity of the residents; lack of opportunities for self-realisation, providing meaningful leisure time; poor quality (absence) of road surfaces; unemployment; spread of crime, alcoholism, corrup- tion; environmental pollution; contamination of drinking water; wear and tear of engineering networks; ageing of the population; lack of invest- ments; insufficient entrepreneurship of the residents; insufficient awareness of the community; unfavourable conditions for business development. These obstacles, in turn, necessitate the solution of a number of tasks that need to be fulfilled for the development of hromadas in line with the goals and objectives of sustainable development (Table 2). Local and regional plans should provide a systemic vision of territorial development and define strategies Table 2 Priority tasks that need to be implemented within hromadas Development priorities at the level of hromadas Relevant sustainable development goal (relevant sustainable development objective) 1. Legal and political spheres Goal 16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels (Tasks 16.3, 16.6, 16.7, 16.10) 2. Waste management Goal 12. Ensure sustainable consumption and production patterns (Task 12.4) 3. Provision of quality administrative services Goal 10. Reduce inequality within and among countries (Task 10.3) Goal 16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels (Task 16.6) 4. Social assistance, communal housing Goal 10. Reduce inequality within and among countries (Tasks 10.1, 10.4) Goal 11. Make cities and human settlements inclusive, safe, resilient and sustainable (Task 11.1) 5. Landscaping Goal 9. Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation (Task 9.6) Goal 11. Make cities and human settlements inclusive, safe, resilient and sustainable (Task 11.2) 6. Water supply and sewerage Goal 6. Ensure availability and sustainable management of water and sanitation for all (Tasks 6.1, 6.2, 6.3, 6.4) 7. Support of business, public organisations Goal 17. Revitalise the global partnership for sustainable development (Task 17.7) 8. Road infrastructure Goal 9. Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation (Tasks 9.1, 9.3) 9. Development of leisure, culture, sports Goal 11. Make cities and human settlements inclusive, safe, resilient and sustainable (Tasks 11.3, 11.6, 11.7) 10. Health care and prevention Goal 3 Ensure healthy lives and promote well-being for all at all ages (Tasks 3.4, 3.5, 3.7, 3.8) 11. Reduction in unemployment Goal 8. Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all (Tasks 8.3, 8.4, 8.6) 12. Education Goal 4. Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all (Tasks 4.1, 4.2, 4.3, 4.4, 4.5, 4.7) 13. Public safety Goal 11. Make cities and human settlements inclusive, safe, resilient and sustainable (Task 11.4) Goal 16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels (Tasks 16.1, 16.9) Source: compiled by the authors on the basis of (Roadmap for Localizing the SDGS: Implementation and Monitoring at Subnational Level; Sustainable Development Goals: Ukraine) Baltic Journal of Economic Studies 213 Vol. 9 No. 5, 2023 based on an integrated and multidimensional approach to inclusive and sustainable development. They should be defined, implemented and monitored with the involvement of key territorial stakeholders in the governance process. These plans should include the following (Sustainable Development Goals: Ukraine, p. 28): – Basic diagnostics of the socio-economic and environmental context; – local or regional priorities; – common goals; – alignment with national (and regional) SDG-based plans; – strategic projects; – budget and financial strategies; – implementation schedule; – mechanisms of joint management; – monitoring and evaluation tools, including a set of local and regional indicators that align with those set out in Agenda 2030. In a resource-constrained environment, local budgets need to be effectively aligned with the priorities identified and set out in local or regional development plans. This involves allocating or reallocating available resources to achieve priorities aligned with the SDGs. 7. Conclusions Determining the prospects for the functioning of hromadas, their role, place, and conditions of activity is important in the modern economy. The objective and subjective development of hromadas is difficult to measure, as it is influenced by a number of factors. Sustainable development can only take place if the balance of welfare is maintained. The lack of resources and capacity has a particularly negative impact on the development of many SMEs and some urban hromadas. That is why regions and local governments play an important role in improving the quality of services by providing technical and financial support through territorial cooperation mechanisms. Implementation of strategic projects and achievement of the SDGs at the local level requires adequate infrastructure and equipment, access to technology and innovation, and skilled human resources. To identify local priorities, existing local and regional programmes should be reviewed to identify the main needs, priorities, gaps and cross-sectoral linkages of the area and their relationship to the SDGs and national priorities. It is necessary to integrate sustainable development goals into territorial development strategies: – Identify priorities for the 17 SDGs based on local context, needs and resources; – determine the needs by analysing existing plans and programmes; – identify priorities through multi-level and multi- stakeholder mechanisms, with a particular focus on inter-regional, inter-city and inter-territorial cooperation to involve as many actors as possible; – establish links and align priorities with national SDG strategies; – adapt existing initiatives and strategies to the SDGs and their goals; – identify actions and resources needed to implement the priority areas of the SDGs; – develop a specific SDG-based plan for their territory or align existing plans with the SDGs; – establish local institutional mechanisms and governance structures to support the implementation of the SDGs; – mobilise local and international human, technical and financial resources by reallocating its own resources, establishing partnerships with universities and other stakeholders, seeking alternative funding channels, combining and improving services and aligning development programmes; – involve all local stakeholders in the implementation of property promotion; – facilitate the exchange of best practices between hromadas; – promote decentralised cooperation and effective development cooperation; – identify policy challenges affecting the localisation of the SDGs and develop recommendations for overcoming them. 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Available at: https://wellbeing.bitc.org.uk/ Received on: 11th of October, 2023 Accepted on: 28th of November, 2023 Published on: 28th of December, 2023