Financing of Innovative Development of the Ukrainian Economy

Introduction Innovative activity becomes an integral and necessary element of the successful development of the country's economy, and the task of the state is to implement an effective financial and innovative policy in order to ensure its stable growth. The article reveals the theoretical foundations of innovative development and states that some scientists considered the territorial aspect of innovative growth, which is caused by fluctuations in the level of innovative activity of different countries and civilizations. The purpose of the article is to study the theoretical foundations of innovative development and assess the current state of financing innovative development of the Ukrainian economy. Methods. The article uses general scientific methods of scientific knowledge, in particular, epistemological method, dialectical method, induction and deduction, formal-logical method, comparative and systematic methods. Results. The article states that a complex of issues related to the quality financing of innovative processes, which require systematicity and predictability, can be solved on the basis of a program-targeted approach to regulating the flow of investments aimed at innovative development. It was established that Ukraine, with a high level of educational and scientific potential, has a low level of implementation of innovations in the field of economic activity and their commercialization. Budgetary funding in Ukraine is the main source of funding for innovative development and an instrument of scientific and technical policy, a form of direct state support. During 2018‒2022, funding of the scientific sphere from the state budget increased by 60.6 %, however, in 2022, the war did not allow maintaining the dynamics of previous years. It is noted that the limited possibilities of the budget determine the relatively low share of sectors of the economy covered by potentially effective innovative developments, the number of which is decreasing. Conclusion. It was concluded that in the conditions of limited financial resources, which the state is able to direct to innovative development, it is appropriate to strengthen the levers of budget policy as a tool for increasing the efficiency of the use of budget funds directed to the innovative development of the country's economy.