**Ukraine Attracts Record Investment Despite War**
Despite the ongoing conflict, Ukraine has attracted record investment in recent years. The country’s determination to rebuild and invest in its future is paying off.
In 2022, an Austrian wood processing company invested €22 million in a new logistics center in Ukraine, despite being forced to meet in a bomb shelter during air raid alerts. This investment was just the beginning of a wave of investment into the country.
Today, most regions in Ukraine are relatively safe for business, and robust investor support programs have driven steady Foreign Direct Investment (FDI) growth. In 2023, FDI reached $4.2 billion, while in the first 10 months of 2024, it reached $3.5 billion.
**New Investments Rise**
Despite a significant portion of investments coming from reinvestments, new investments are also on the rise. Ukrainian domestic companies and investors committed to the country’s future continue to launch new products and expand their reach into new markets in sectors such as agriculture, construction, logistics, energy, machine industry, and pharmaceuticals.
Foreign companies, including Unilever, Azerbaijan’s NEQSOL Holding, and Austrian Kronospan, are also cautiously following suit. French investor Xavier Niel recently made a $600-million acquisition of a Ukrainian telecom provider, the largest deal since the start of the full-scale invasion.
**Tools for Investors**
Several tools are in place to support investors who want to establish production in Ukraine. Industrial parks, such as those operated by the Ukrainian government’s state agency, are particularly effective. These zones offer tax and customs incentives, as well as access to finance through the 5-7-9% Affordable Loans Program.
The Significant Investments Program also offers up to 30% compensation through tax and customs benefits for businesses investing at least €12 million in the country.
**EU Support**
Ukraine has received significant support from the European Union (EU) in recent years. The EU’s Investment Portal lists 126 projects worth $28.9 billion, while a draft law currently awaiting approval aims to simplify public-private partnerships (PPPs) and align procedures with EU standards.
Preparations are underway for concession projects at the Chornomorsk port and pilot healthcare PPPs. If approved, these projects could attract significant investment into Ukraine’s infrastructure and healthcare sectors.
**Privatization Efforts**
The year 2024 marked a milestone for Ukraine’s privatization efforts, with iconic assets like the Hotel Ukraine, the titanium producer United Mining and Chemical Company, and the Aeroc Plant finding new owners. Loss-making state enterprises now have an opportunity to revive, while sanctioned assets can become engines of national recovery.
**War Insurance Infrastructure**
Developing a robust insurance infrastructure is essential for attracting investment into Ukraine. The country’s Export Credit Agency has begun offering war insurance for export-oriented manufacturers, while the European Bank for Reconstruction and Development (EBRD) introduced long-awaited cargo insurance.
The U.S. International Development Finance Corporation expanded its tools to enable small and medium businesses to secure insurance through Ukrainian reinsurers. A comprehensive state-backed war risk insurance system is being established with the National Bank to provide additional support to investors.
Despite the challenges posed by war, Ukraine has demonstrated that it remains an attractive destination for investment. The country’s determination to rebuild and invest in its future is paying off, and new investments are rising every year.