The Impact of Geopolitical Instability on Investment Management in Ukraine: Analysis of Risks and Opportunities

Abstract

The geopolitical situation plays a crucial role in an investor's decision to allocate its resources to a particular sector of the economy, country or region. Military confrontations, political crises, and the unattractive investment climate of certain countries are becoming key factors in investors' assessment of risks and opportunities for long-term investments and in building investment strategies. This paper analyzes the main geopolitical challenges and the current state of investment activity in Ukraine. The results show that in 2023, global investment flows decreased by 2% due to a significant increase in geopolitical tensions. However, despite all the geopolitical challenges, Ukraine has a number of prospects for developing its investment attractiveness. In particular, Ukraine has adopted a number of positive legislative initiatives. In addition, the growth of foreign direct investment flows is possible in the technology sectors, such as IT and the defence industry.