Saturation of domestic market with home production is the most important condition for country’s economic safety (ABSTRACT)

Nikala Jugeli

Saturation of any market (whether domestic, foreign and regional) with production (services) implies complete parity of demand and supply. A market is saturated when demand for production or service is fully provided both quantitatively and qualitatively with production and services of appropriate consumer quality.

Economic safety requires saturation of at least principal segment of domestic market with high quality local production (service) corresponding to country’s economic profile.
Due to the great importance of state and macroeconomic problem of saturating local market demands with local production (services), the issue should become a priority direction of public administration.
With economic safety issue in the foreground, there arises a question of elaborating state concept and developing appropriate programme in this sphere.
It is necessary to develop near-term specific economic safety programmes, in particular, food security, employment and insurance programmes, etc.
First of all, it is necessary to solve the issue of public administration and economic regulation with the view of meeting domestic market demands for local production. This requires practical legislative framework, state regulation mechanism encouraging introduction and development of market relations. By means of rational organisational structure, this would provide necessary conditions for the conduct of appropriate fiscal and monetary policy, estimation and effective use of country’s industrial potential, research of internal market and balancing of its needs; formation and functioning of labour force training and skills improvement system. Regulation of domestic market demand implies fulfilment of quite complex functions on the state part. The functions are as follows:
1. Analysis and estimation of internal market demand, factual satisfaction of its demands;
2. Forecasts of internal market demand and condition of demand satisfaction.
3. Development of state programme for domestic market demand and demand satisfaction based on the specified forecasts.
Apart from the above-mentioned, development of home enterprise and business requires protectionist policy (effective use of tariffs, fiscal tariffs, protectionist tariffs, quota, non-tariff barriers, etc.), which will entail an increased number of independent economic subjects and growth of their economic activity.