Economic And Political Development Of Ukraine: Importance Of Foreign Direct Investment

The purpose of this paper is to give an overview of the economic and political development of Ukraine, as well as to explain why foreign direct investment is important for Ukraine’s economy. This study applies the qualitative method in order to investigate the issue and is based on both primary and secondary data. Qualitative interviews represent the primary data sources, conducted with individuals who are either investors or have high expertise of the topic. News articles, previous research papers and literature are used as a secondary data source. The results show that the biggest challenges in political development of Ukraine lie in the continuous war with Russia. Nevertheless its important to keep in mind that countries like Ukraine can only be rebuild with the help of foreing investors as they allow the transfer of technology – particularly in the form of new varieties of capital inputs – that cannot be achieved through financial investments or the trade of goods and services. FDI can also promote competition in the domestic input market. For that reason it is important to examine existing policies as well as look for new ways of increasing the foreign investment flow.