Кwilinski Alex www.virtual-economics.eu ISSN 2657-4047 (online) Aleksy Kwilinski Virtual Economics, Vol. 4, No. 4, 2021 61 2021 Volume 4 Number 4 (October) A REVIEW OF THE MONOGRAPH BY YU.M. KHARAZISHVILI “SYSTEMIC SECURITY OF SUSTAINABLE DEVELOPMENT: EVALUATION TOOLS, RESERVES AND STRATEGIC IMPLEMENTATION SCENARIOS” Aleksy Kwilinski Abstract. The monograph proposes a modern concept of sustainable development from the standpoint of security, which contains a general systematic idea of ways to move from the current position of the object of management to the desired. The necessity to adhere to the limits of safe existence of dynamic economic systems, which connects the problem of sustainable development with the problem of security, is substantiated. The presented concept is based on the methodology of identification and strategy of sustainable development from the standpoint of security and adaptive methods of regulation of management theory for the scientific justification of strategic planning in the medium and long term. It is proposed to take into account the shadow indicators in the components of sustainable development to reveal the adequacy of the real state of the economy using the developed method of its assessment and de-shadowing. The violation of the generality of macroeconomic identity of GDP by the end-use method at the regional level is proved and on this basis the method of determining the shadow net export due to violations at customs and in interregional movement of goods and services is proposed. Possibilities of application of the stated approaches at different levels of economic activity are shown. The dual role of the shadow economy is revealed: as obstacles to sustainable development and as a significant reserve for modernization and growth of Ukraine's economy. Keywords: concept, economic systems, indicators, macroeconomic, management, sustainable development JEL Classification: B41, E60, O17 Author: Aleksy Kwilinski The London Academy of Science and Business, 120 Baker Street, London, United Kingdom, W1U 6TU E-mail: a.kwilinski@london-asb.co.uk https://orcid.org/0000-0001-6318-4001 Citation: Kwilinski, A. (2021). A Review of the Monograph by Yu.M. Kharazishvili “Systemic Security of Sustainable Development: Evaluation Tools, Reserves and Strategic Implementation Scenarios”. Virtual Economics, 4(4), 61-64. https://doi.org/10.34021/ve.2021.04.04(5) Received: August 15, 2021. September 9, 2021. Accepted: September 24, 2021. © Author(s) 2021. Licensed under the Creative Commons License - Attribution 4.0 International (CC BY 4.0) https://creativecommons.org/licenses/by/4.0/ www.virtual-economics.eu ISSN 2657-4047 (online) Aleksy Kwilinski Virtual Economics, Vol. 4, No. 4, 2021 62 Mankind is on the crest of an explosive demographic wave, but even accelerated economic growth is unable to meet the growing needs of the population. This impoverishes millions of people and depletes the planet's resources. The latter necessitated the development of a new paradigm of socio-economic development, taking into account environmental constraints, one of which was called "sustainable development". It was based on the analysis of the causes of the environment's catastrophic degradation on the biosphere scale and the search for ways to overcome threats to the environment and human health. The author of the monograph highlights the main principles of the Concept of Sustainable Development, which indicate the need for the interrelationship of three components: economic, social and environmental - on the way to overcoming global problems. In this context, technology can contribute to achieving goals in all three dimensions of sustainable development, the balance of which is one of the leading issues of sustainable development not only in individual countries or regions but also in the world as a whole. The study proved that the achievement of the sustainable development goals is based on the economic security (ES) of the country as an integral characteristic of the economic system's state, the most important component of national security. Its level determines to a certain extent the level of social and environmental components, as well as the level of the security and defence sector. Revealing the need for an integrated evaluation and a systematic approach to regulating the level of economic security of the state, the author presents the dynamics of the ES index and its components. And this indicates the development of an appropriate methodology and adequate diagnosis of the level of the country's ES and its components with the further possibility of interpretation. The developed comprehensive methodology for identification and strategizing in the field of national security is universal and allows comparing the components and indicators of different areas of security and justifying strategic scenarios for security development. The methodology is based on the concept of sustainable development from the standpoint of security, which is grounded on: - applied systems theory; - management theory; - economic cybernetics. It is expedient for the author to maintain that the development of the concept of sustainable development requires the interaction of multidirectional experts: economic cybernetics, macroeconomists, sociologists, environmentalists, ecologists, geographers, and politicians. The proposed concept of sustainable economic development (countries, regions) from the standpoint of security, which is a management structure, contains a general systematic view of the ways of transition from the current position of the object of management to the desired one. In this context, there are considered in detail the methodological tools for determining the status and strategic guidelines of sustainable development, and a number of shortcomings and inaccuracies that complicate or prevent their use, which allowed the improvement of the tools through the stages of identification and strategizing. www.virtual-economics.eu ISSN 2657-4047 (online) Aleksy Kwilinski Virtual Economics, Vol. 4, No. 4, 2021 63 The author's novelty development of the identification stage is sure to be a new modified method of rationing, a new method of "sliding matrix" to determine dynamic weights, the use of "t-test" for scientific justification and vector formalized determination of threshold values of characteristic types of distribution, justification of the criterion for achieving the sustainable development level as the average value of the "homeostatic plateau", the definition of sustainable development imbalances to justify the list of threats. The most important stage in achieving the level of sustainable development is the stage of strategizing - future strategic changes to achieve a certain goal. Due to the fact that classical methods of predicting integral indices using polynomials and regression equations are inappropriate here, the author's originality in solving this problem deserves attention: goal- setting and application of adaptive control methods in management theory to solve the problem of sequential decomposition of integral indices by solving the inverse problem. At the same time, the author points out the lack of scientists' attention to determining the dynamics of the integrated ES index and comparing it with the integrated threshold values, first of all, regarding not fully taking into account the shadow indicators of the ES. The latter has a significant impact on the final figure, because, according to experts, it is the shadow sector that accounts for about 50% of GDP. It is quite obvious that the lack of consideration of the shadow aspects of economic activity is inadequate for the real economy and can lead to the wrong measures and in the wrong place. The methods used in Ukraine to evaluate the shadow economic activity are mainly borrowed from abroad and adapted to Ukrainian realities; they roughly determine the relative changes in the shadow economy and, quite approximately, its absolute size. None of the current estimates of the shadow economy provides an answer to the question about the amount of GDP that is created in addition to those already taken into account in official statistics, and what part of the official GDP is created by shadow labour payment. The functionality of the known methods is limited only by the calculation of shadow GDP, ignoring other aspects of shadow activity, such as shadow wages, shadow employment, shadow capital loading, shadow intermediate consumption, shadow consolidated budget revenues (losses), shadow energy consumption, shadow energy consumption, shadow net export. It is these functions that distinguish the author's method of "social justice". Given the obtained results, strategic scenarios of sustainable development of Ukraine (living standards, industry, transport system in general, and railway transport in particular) are determined on the basis of selected indicators for each of these components. At the same time, based on the results of the calculations, the author concludes that the greatest effect of sustainable development can be achieved by applying the scenario of full-value balance - the equidistance of integrated indices of development components from their average optimal values. Based on the results of calculations, Strategic Scenarios for Sustainable Development of Industrial Regions of Ukraine are proposed. The practical implementation of determined scenarios for the components of development is impossible without a significant reduction in corruption and the level of the economy shadowing. In this context, it is difficult to disagree www.virtual-economics.eu ISSN 2657-4047 (online) Aleksy Kwilinski Virtual Economics, Vol. 4, No. 4, 2021 64 with the author's opinion on the possibilities of applying and implementing the achievements of the new paradigm of Industry 4.0. In general, the monographic work is a holistic and complete study of the extremely important problem of not only overcoming the shadowing of Ukraine's economy on the path to sustainable development but also attracting the released resources to modernization processes. Outlined by the author, based on in-depth analytical research, strategic scenarios of sustainable development of individual sectors of the economy and industrial regions as a whole will be perceived by the scientific community, heads of central and local governments, scientists, and experts in related fields. The peer-reviewed monograph, as well as other recent publications by the author, show that the developed methodological approaches are implemented at the global level, have scientific, theoretical and practical significance, are universal, suitable for any country to be put into practice and tested at the national level (Ukraine, Georgia, Poland), for regions and types of economic activity and can be useful for heads of central and local authorities, scientists, specialists in the field of sustainable development, economic security and the shadow economy.