Restoration of Foreign Direct Investment (FDI): Global Perspectives and Opportunities for Ukraine

Abstract

Shaping favorable conditions for investors and restoring Ukraine's economy in wartime requires a comprehensive approach that considers global trends, national interests, and the country's internal capabilities. The study aims to identify opportunities for attracting foreign direct investment (FDI) to Ukraine and its main directions in the context of global FDI recovery prospects. The paper analyzes the volume of global FDI, investment directions, and trends in their change. It is established that the main focus of global investment has shifted to the Sustainable Development Goals (SDGs) sectors in developing countries. Despite COVID-19 and the massive destruction caused by the war, investors continue to operate and even strive to expand their businesses in Ukraine. The paper identifies the main problems, factors, and reasons for continued investment in the country, including the availability of qualified, trained people and inexpensive labor; the size of the local market; a competitive cost structure in Ukraine; proximity to regional markets; the search for links with partners; infrastructure (utilities and transport); affordable investment objects at competitive prices; natural resources. It is argued that to attract foreign investment, Ukraine must create a favorable climate, appropriate conditions for investors, and determine the volume and directions of investment. Priority sectors for attracting FDI are investment projects with significant investments, industrial parks, information technologies, agriculture and agro-processing industry, production of eco-transport and its components, green energy, creative industry, aircraft construction, research and development and innovation activities, infrastructure, mechanical engineering. Specific measures at the national level are determined to increase investment flows and update Ukraine's economy, and urgent issues that require resolution and reforms are considered. It is established that stimulating FDI is a key element of Ukraine's economic recovery and ensuring its sustainable development, which should lead to positive results of the implementation of reforms: improvement of the business climate, ensuring financial stability and access to capital, effective tax and fiscal policies, infrastructure development, ensuring legal security and strengthening anti-corruption measures, human capital development, implementation of environmental standards.