The Coronavirus pandemic has exposed vulnerabilities in global supply chains. Businesses around the world have experienced trade restrictions, delays in contractual obligations and shortages of critical supplies such as medical materials. Many countries around the world are seeking to come up with ways to bolster their economies. Ukraine, for example, is hoping the pandemic will transform global supply chains in ways that will allow it to lure investments away from Asia and into Ukraine’s own economy.
Ukraine benefits from its geographical location between Asia and the European Union, making it an ideal location for European investors to avoid long term supply chains. Ukraine’s government has also sought to make the country a desirable destination for investors and is providing incentives. Certain benefits are being granted to investors who commit more than 20 million euros, for example. Last year, UkraineInvest (an independent advisory body with a mandate to attract and support foreign direct investment) secured more than $600 million of investments.
Ukraine’s potential is undoubtedly becoming known to the wider international community. Currently, Ukraine has $1.1 billion invested in mining and processing capabilities by Canada’s Black Iron Inc. Belgian mattress-fabric maker Monks International and Danish furniture producer Hjort Knudsen are also building plants in Ukraine.
Other countries will no doubt follow Ukraine’s example in offering incentives to invest in their economies and industrial infrastructure.
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