For the last few years, Ukraine has become a top-notch priority for foreign investors, which gives entry to a massive sales market with over 42 million buyers. Some of you might be wondering about what reasons made Ukraine relatively favorable for foreign investments. In that case, make sure to scroll down because we have incorporated some possible explanations.
Ukraine is the third largest grain exporter in the world and has a 3.3% annual GDP growth. Also, each year, around 17 different types of businesses are coming into the market, and over 36 countries across the world have business relationships with Ukraine. The foreign direct investment (FDI) of Ukraine is about $4.5 billion, and this country has an average yearly growth of $0.36 billion in FDI investments.
There are several reasons for an increase in foreign investments in Ukraine, such as freedom from limitations on the local market, geographical location, labor costs, high scientific ability, and many more. In the below section, we will get to know the primary reasons which increase the foreign investments in Ukraine.
Top 7 Reasons Explaining Why Ukraine Is Getting More Foreign Investments
If you are interested in making investments in Ukraine, make sure to check out good-time-invest.com, where you can get in touch with professionals by booking an appointment. Below we have listed and will talk about the best reasons due to which Ukraine is becoming a priority for several foreign investments.
1. Excellent Geographical Location
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Ukraine’s geographical location holds significant importance. It is the second-largest country in Europe and is located at intersections of trade roads to Europe, Central Asia, the Middle East, and the Caucasus. Ukraine has various international transport corridors with other countries. In addition to that, Ukraine retains 19 free trade agreements with 46 different countries.
The flight time from Ukraine to key global business hubs is also less, for example, you can reach London from Ukraine in just three hours. Plus, the flight time from Ukraine to other countries is as follows:
Istanbul – 2 hours
Brussels – 3 hours
Dubai – 5 hours
Beijing – 9 hours
New York/ Washington D.C. – 10 hours
Brasilia – 20 hours
Sydney – 20 hours
2. Agricultural Land And Innovative Agritech Sector
Agribusiness contributes the most to Ukraine’s economy. This country contains more than 25% of the world’s black soil, which is highly fertile. Ukraine is one of the largest producers and exporters of grains and sunflower oil across the world. Ukraine, being one of the world’s largest producers of agricultural products, is attracting more foreign investments.
Due to the active benefits in agricultural farmland, several foreign investors are eager to invest in Ukraine. In addition to that, this country is famous for its high quality and farming invention in the agritech industry.
Corporations in Ukraine focus on formulating solutions that can make framing easy and quick.
The Ukrainian government gives primary preference to the Agriculture sector. Besides that, it has signed Association Agreement and DCFTA (agreements related to agriculture) with the European Union (EU). In order to get more foreign investments, this country’s government is presently executing various projects with help of the EBRD.
3. Skilled Workforce At Cheaper Rates
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In Ukraine, more than 40 million people are highly educated, and about 70% of them have completed either secondary or higher schooling. Ukraine’s workforce is known to be highly skilled with relevant experience. As the educational system in Ukraine primarily concentrates on technical and scientific training, employees generally have more skills.
Ukraine has the largest IT engineering workforce in both Central and Eastern European countries. Maximum employees can speak various languages, such as Ukrainian, English, Russian, and others. In addition to that, the skilled workforce can be hired at a cheaper cost, which is one of the primary reasons why foreign investors are more enthusiastic to capitalize in Ukraine than other developed countries.
4. Well-organized And Developed Infrastructure
Though it is not a developed country, Ukraine has a reputation for its well-organized and highly developed infrastructure. In terms of transportation, this country has numerous high-end seaports, railways, airports, road trade routes, and more. Ukraine also has large warehouses, communication systems, and engineering networks.
In addition to that, Ukraine has high-rise buildings, designed bridges, functional residential complexes, highways, monuments, and many others. Due to the highly developed infrastructure, Ukraine is becoming one of the best choices for foreign investments.
5. Ease of Doing Business
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For the past years, Ukraine has been improving its rank in the Ease of Doing Business rankings. In the 2024 data of World Bank’s Ease of Doing Business category, Ukraine got 64th rank out of 190 countries. If we consider previous year ratings, this country’s rank is 71. During the 2014 to 2018 period, Ukraine climbed 24 ranks in the Ease of Doing Business rankings.
In addition to that, the World Bank declares that Ukraine is the second country on the list to have significant growth speed and in-depth advancement of the business climate for the past 10 years.
6. Deregulation Measures
Lately, the government has been taking severe deregulation efforts and decentralization reforms to bring more foreign investments to the country. Some of those deregulation measures include transferring registration services to local governments and a private sector, lessening the total licenses (permits, certificates, tax administration), simplifying registering property rights, and more.
7. Other Legislative Advantages
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Lastly, Ukraine has been offering plenty of legislative advantages in order to get more investments from foreign investors. For example, the feed-in tax created by Ukraine is getting more recognition from investors in the business sector. Besides that, the lawful provisions for inward processing provide plenty of chances for foreign investment companies to take advantage of Ukraine’s geographical position for gaining more profits.
Bottom Line
To summarize this post, due to the advancements of Ukraine in various aspects, several foreign investors are eager to make investments in this country. Making investments in Ukraine is an excellent chance to capitalize funds in a developing country that has a strategic geographical location, skilled workforce, and low production expenses.
