FOREIGN EXPERIENCE IN FORMING ECONOMIC MECHANISMS FOR ATTRACTING AND USING FOREIGN DIRECT INVESTMENT UNDER ECONOMIC TRANSFORMATION AND POSSIBILITIES FOR ITS ADAPTATION IN UKRAINE
DOI:
https://doi.org/10.32782/city-development.2026.3-7Keywords:
foreign direct investment, economic mechanism, investment policy, economic transformation, digitalization, investment risks, structural modernization, post-war reconstructionAbstract
The article examines international experience in developing economic mechanisms for attracting and using foreign direct investment under conditions of economic transformation. Contemporary approaches to investment policy are systematized, and four models of FDI attraction and utilization are distinguished: the European institutional, innovation and technology, structural transformation, and risk-oriented models. The study identifies the importance of institutional support, digitalization of administrative procedures, investment promotion, investor aftercare, targeted investment incentives and mechanisms for managing political and war-related risks. Particular attention is paid to the transition from policies focused primarily on the volume of foreign capital attracted to an approach based on the quality of FDI and its long-term contribution to productivity, innovation, technological modernization, employment and integration into global value chains. The study substantiates the feasibility of developing a combined model for Ukraine that integrates institutional stability, innovation orientation, structural modernization instruments and risk mitigation mechanisms. The main directions for implementing such a model include the development of a national investor aftercare system, further digitalization of investment procedures, creation of an integrated digital investment infrastructure, transition from broad incentives to targeted support for strategic investment projects, and wider application of political and war-risk insurance and international guarantees. The need to improve the system for evaluating investment policy effectiveness is substantiated by shifting the focus from monitoring FDI volumes to assessing their qualitative and long-term effects. The proposed approach is aimed at attracting high-quality foreign investment capable of supporting structural modernization, technological renewal, post-war reconstruction and the long-term competitiveness of the Ukrainian economy.
References
FDI Qualities Policy Toolkit: Report. Paris: OECD Publishing, 2022. 196 p. OECD. DOI: https://doi.org/10.1787/7ba74100-en
Foreign Direct Investment Qualities and Impact. OECD. URL: https://www.oecd.org/en/topics/sub-issues/foreign-direct-investment-qualities-and-impact.html
World Investment Report 2024: Investment facilitation and digital government. Geneva: United Nations, 2024. 189 p. Unated Nations, UN Trade and Development (UNCTAD). URL: https://unctad.org/publication/world-investment-report-2024
Investment Policy and Promotion. June 8, 2021. World Bank Group. URL: https://www.worldbank.org/en/brief/2021/06/08/investment-policy-and-promotion
Dolowitz D.P., Marsh D. Learning from Abroad: The Role of Policy Transfer in Contemporary Policy-Making. Governance. 2000. Volume 13, Issue 1. pp. 5-24. DOI: https://doi.org/10.1111/0952-1895.00121
Investment: PAIH’s Offer for Investors. Polish Investment & Trade Agency. PFR Group. URL: https://www.paih.gov.pl/en/about-us/offer/investment/
Polish Investment Zone. Polish Investment & Trade Agency. PFR Group. URL: https://www.paih.gov.pl/en/why-poland/investment-incentives/polish-investment-zone/
Business and Investment Development Agency: Investment Incentives. CzechInvest, part of CzechBusiness. URL: https://czechinvest.gov.cz/en/For-Investors/Investment-Incentives
Business and Investment Development Agency: AfterCare. CzechInvest, part of CzechBusiness. URL: https://czechinvest.gov.cz/en/For-Investors/AfterCare
Calculation of basic exemption. Republic of Estonia. Estonian Tax and Customs Board. URL: https://www.emta.ee/en/private-client/taxes-and-payment/tax-incentives/calculation-basic-exemption
Get started with Your new business in Estonia. Invest in Estonia. URL: https://investinestonia.com/start/
Adapt Intelligently: A Strategy for Sustainable Growth and Innovation 2025-2029. IDA Ireland. URL: https://www.idaireland.com/ida-ireland-strategy-2025-2029
About IDA Ireland. IDA Ireland. URL: https://www.idaireland.com/about-ida-ireland
Who We Are: What we do. The Singapore Economic Development Board (EDB). URL: https://www.edb.gov.sg/en/who-we-are
One-North. JTC: A Singapore Government Agency Website. URL: https://www.jtc.gov.sg/find-land/jtc-key-estates/one-north
About Invest KOREA. Kotra: Invest KOREA. URL: https://www.investkorea.org/ik-en/cntnts/i-5067/web.do
Finding Business Opportunities in Kore: Korea's Solid Economic Fundamentals. Kotra: Invest KOREA. URL: https://www.investkorea.org/ik-en/index.do
MIGA’s Ukraine Response. World Bank Group; Guarantees, MIGA: Private Capital for Public Good. URL: https://www.miga.org/ukraine
The Ukraine Facility: Supporting Ukraine’s recovery, reconstruction, and path towards EU accession. European Commission. URL: https://commission.europa.eu/topics/eu-solidarity-ukraine/eu-assistance-ukraine/ukraine-facility_en
Макалюк І.В., Свистун С.І. Роль прямих іноземних інвестицій у розвитку економіки України. Економіка та суспільство. 2026. № 86. DOI: https://doi.org/10.32782/2524-0072/2026-86-98
Євтушенко Н.О. Прямі іноземні інвестиції: стан та перспективи розвитку. Економічний простір. 2023. № 188. С. 83-88. DOI: https://doi.org/10.32782/2224-6282/188-14
Мошляк І.О. Прямі іноземні інвестиції як фактор економічного зростання держави. Вчені записки Університету «КРОК». 2021. № 3 (63). С. 44-50. DOI: https://doi.org/10.31732/2663-2209-2021-63-44-50
Кадеєва І.В. Прямі іноземні інвестиції як фактор становлення інноваційної економіки в Україні. Збірник наукових праць Харківського національного педагогічного університету імені Г.С. Сковороди. Економіка. 2014. Вип. 14. С. 193-199.
FDI Qualities Policy Toolkit: Report. Paris: OECD Publishing, 2022. 196 p. OECD. DOI: https://doi.org/10.1787/7ba74100-en
Foreign Direct Investment Qualities and Impact. OECD. Available at: https://www.oecd.org/en/topics/sub-issues/foreign-direct-investment-qualities-and-impact.html
World Investment Report 2024: Investment facilitation and digital government. Geneva: United Nations, 2024. 189 p. Unated Nations, UN Trade and Development (UNCTAD). Available at: https://unctad.org/publication/world-investment-report-2024
Investment Policy and Promotion. June 8, 2021. World Bank Group. Available at: https://www.worldbank.org/en/brief/2021/06/08/investment-policy-and-promotion
Dolowitz D.P., Marsh D. Learning from Abroad: The Role of Policy Transfer in Contemporary Policy-Making. Governance. 2000. Volume 13, Issue 1. pp. 5-24. DOI: https://doi.org/10.1111/0952-1895.00121
Investment: PAIH’s Offer for Investors. Polish Investment & Trade Agency. PFR Group. Available at: https://www.paih.gov.pl/en/about-us/offer/investment/
Polish Investment Zone. Polish Investment & Trade Agency. PFR Group. Available at: https://www.paih.gov.pl/en/why-poland/investment-incentives/polish-investment-zone/
Business and Investment Development Agency: Investment Incentives. CzechInvest, part of CzechBusiness. Available at: https://czechinvest.gov.cz/en/For-Investors/Investment-Incentives
Business and Investment Development Agency: AfterCare. CzechInvest, part of CzechBusiness. Available at: https://czechinvest.gov.cz/en/For-Investors/AfterCare
Calculation of basic exemption. Republic of Estonia. Estonian Tax and Customs Board. Available at: https://www.emta.ee/en/private-client/taxes-and-payment/tax-incentives/calculation-basic-exemption
Get started with Your new business in Estonia. Invest in Estonia. Available at: https://investinestonia.com/start/
Adapt Intelligently: A Strategy for Sustainable Growth and Innovation 2025-2029. IDA Ireland. Available at: https://www.idaireland.com/ida-ireland-strategy-2025-2029
About IDA Ireland. IDA Ireland. Available at: https://www.idaireland.com/about-ida-ireland
Who We Are: What we do. The Singapore Economic Development Board (EDB). Available at: https://www.edb.gov.sg/en/who-we-are
One-North. JTC: A Singapore Government Agency Website. Available at: https://www.jtc.gov.sg/find-land/jtc-key-estates/one-north
About Invest KOREA. Kotra: Invest KOREA. Available at: https://www.investkorea.org/ik-en/cntnts/i-5067/web.do
Finding Business Opportunities in Kore: Korea's Solid Economic Fundamentals. Kotra: Invest KOREA. Available at: https://www.investkorea.org/ik-en/index.do
MIGA’s Ukraine Response. World Bank Group; Guarantees, MIGA: Private Capital for Public Good. Available at: https://www.miga.org/ukraine
The Ukraine Facility: Supporting Ukraine’s recovery, reconstruction, and path towards EU accession. European Commission. Available at: https://commission.europa.eu/topics/eu-solidarity-ukraine/eu-assistance-ukraine/ukraine-facility_en
Makaliuk I., Svystun S. (2026). Rol priamykh inozemnykh investytsii u rozvytku ekonomiky Ukrainy [The role of foreign direct investment in the development of Ukraine’s economy]. Ekonomika ta suspilstvo – Economy and Society. № 86. DOI: https://doi.org/10.32782/2524-0072/2026-86-98
Yevtushenko N. (2023). Priami inozemni investytsii: stan ta perspektyvy rozvytku [Foreign direct investment: status and development prospects]. Ekonomichnyi prostir – Economic Scope. № 188. S. 83-88. DOI: https://doi.org/10.32782/2224-6282/188-14
Moshlyak I. (2021). Priami inozemni investytsii yak faktor ekonomichnoho zrostannia derzhavy [Foreign direct investments as a factor of the state's economic growth]. Vcheni zapysky Universytetu «KROK» – Scientific Notes of «KROK» University. № 3 (63). S. 44-50. DOI: https://doi.org/10.31732/2663-2209-2021-63-44-50
Kadeieva I.V. (2014). Priami inozemni investytsii yak faktor stanovlennia innovatsiinoi ekonomiky v Ukraini. Zbirnyk naukovykh prats Kharkivskoho natsionalnoho pedahohichnoho universytetu imeni H.S. Skovorody. Ekonomika. Vyp. 14. S. 193-199.
