Importance The article unfolds the concept of efficacy of regional budgetary spending and analyzed the interaction of regional authorities and business when they implement concession agreements in the current conditions. Objectives The research explores the specifics and analyzes the current issues of the interaction of the State and private business when they perform concession agreements. Methods The research relies upon proceedings of economists concerning the improvement of efficacy of regional budgetary spending, studies of experts who deal with issues of the interaction of the State and private business as part of concession agreements. We applied systems analysis, subjective and objective analysis, economic and statistical analysis, and the dialectical method of research through general scientific methods and techniques. Results We examined the contemporary practice for the State and private business to interact when implementing concession agreements. Conclusions and Relevance Considering the State support to socio-economic development of the society, an increased efficacy of budgetary spending mainly depends on the implementation of concession agreements. The Russian regions have been demonstrating higher interest in such agreements. Regional authorities and private business come across certain difficulties in implementing concession agreements since there are no long-standing principles of regulation, obligations to ensure concession holders to fulfill their investment commitments. The interaction has positive effect and depends on an effective system for statutory and legislative regulation, stable political situation in the region, systems approach to developing the infrastructure sector of the region, etc.
Keywords: concession agreement, State, private business
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