What are the different methods of promoting economic development?
Economic development, which supports a better standard of living through economic growth, can be promoted in many ways and on many fronts, starting with the introduction and support of a modern political, legal and financial system, which ensures that property is recognized. It can also help improve the country's physical infrastructure, just as it can encourage foreign investment. The taxation system, which provides permanent income for the government without exhausting the public pockets, can help, as well as contracts between nations that offer stability to international business efforts. The system should allow businesses to prove their ownership of assets and prevent this ownership against the challenges of courts. The legal system should provide a stable of the business environment by providing the rights of the company, business regulations and reliable tax and customs laws. The banking system should be well regulated to ensure that businesses are able to obtain loans for new projects or acquisitions. This should be supportiveWell, with a stable political system that ensures that businesses can operate without undue intervening of the government and certainty that the legal structure will not be inverted.
Another way of promoting economic development is to improve physical infrastructure in the country. This includes roads, rail system, waterways, maritime ports and airports. Reliable infrastructure allows businesses to reduce their costs by efficient and fast transport of goods. Improved infrastructure can also allow busy businesses to reduce transport costs and become more competitive in the internanaric market, balance of goods through marine ports and airports. Other institutions, such as schools and hospitals, could be widespread and the education and health of the population could therefore improve.
Country can also create a favorable environment for foreign investment, possibly encouragement of joint businesses between foreign departmentsIky and own businesses. This may provide opportunities to support economic development through technology transmission or through joint research and development. The country can create special economic zones or free zones that offer good infrastructure and tax advantages for businesses that settle in zones. These incentives could support certain types of activities, such as production for export or high-tech technology, thereby supporting economic development.
The modern tax system is generally considered necessary to support economic development. The government needs a stable source of income that can be used in the financing of the physical and institutional infrastructure of the country. Taxes must be related to the income and consumer patterns of the population to ensure that government income can grow in accordance with the growth of production in the economy. Trained tax inspectors must be equipped to enforce tax laws and fight against tax evasion of people and businesses, including foreign investmentoles.
Modern network of contracts and agreements can also contribute to promoting economic development. Agreements on protection and promotion of investment may enable foreign companies to trade with greater confidence in the country by providing guarantees against expropriation or nationalization of assets. Double tax agreements can protect foreign companies from paying tax in more than one country, by allocating taxation rights between countries and providing mechanism of dispute resolution. On a wider scale, the country can support its own economic development by connecting to customs trade unions or signing free trade with neighboring countries and other business partners.