METHODOLOGICAL FOUNDATIONS FOR DEVELOPING A TERRITORIAL COMMUNITY ECONOMIC DEVELOPMENT STRATEGY BASED ON THE CIRCULAR ECONOMY

Abstract

Relevance. Under the ongoing conditions of decentralization, post-war recovery, and systemic transformations of the national economy, searching for flexible long-term planning tools for local territorial development emerges as a critical priority. Traditional linear economic models are exhausting their potential, which objectively requires a transition to a circular economy (closed-loop economy) capable of ensuring the rational use of endogenous resources, enhancing environmental safety, and securing sustainable competitive advantages for territorial communities.
The objective of the study is to provide a comprehensive theoretical, methodological, and applied substantiation and a detailed step-by-step description of an advanced four-component framework for developing a territorial community economic development strategy based on the principles of the circular economy, defining specific analytical tools, key performance indicators, and practical implementation matrices for project solutions.
Research methods. The study utilizes methods of analysis, synthesis, and descriptive structuring to systemize theoretical and methodological approaches; methods of complex economic and statistical analysis to form a diversified system of assessment indicators; tools of SWOT and PEST analysis to identify the internal potential of communities and destructive macro-factors of the external environment; and matrix modeling for the decomposition of applied project proposals.
Results. A four-component framework for strategy formation has been substantiated and detailed, logically integrating analytical, strategic, tactical, and result-oriented blocks. A comprehensive system of key performance indicators (KPIs) is proposed to evaluate the circular maturity of local economies (including infrastructural, financial, social, innovative, and waste management performance metrics). Particular attention is paid to the mechanisms of cross-sectoral interaction (the quadruple helix model), stakeholder engagement through flexible public-private consultations, digitalization initiatives, securing cybersecurity protocols for local information systems, and algorithms for continuous multi-level monitoring and reporting of deviations.
Practical value of the work. The developed methodological guidelines and analytical matrix frameworks provide a practical toolkit that can be directly implemented by local governments, municipal managers, regional experts, and developers of strategic documents to eliminate linear models and build efficient pathways toward green municipal transitions.
Conclusions. An economic development strategy based on the circular economy serves as an irreplaceable tool for securing sustainable competitive advantages, local economic stability, and environmental safety for territorial communities. The proposed step-by-step framework ensures comprehensiveness, transparency, and financial viability during transitional processes. To eliminate resource inefficiency, local authorities are recommended to scale up initiatives focused on organic waste utilization, loop-closing water supply, sharing economy platforms, and stimulating eco-innovations at the municipal level.