INNOVATIVE INDUSTRIAL PRODUCTION AS A DRIVER OF UKRAINE’S ECONOMIC DEVELOPMENT IN THE CONTEXT OF WAR, RECOVERY AND GLOBAL COMPETITION

Abstract

Against the backdrop of deglobalization and the ongoing U.S. - China trade confrontation, Ukraine holds unique opportunities – it can substitute a number of imports, attract investment, and become a manufacturing hub. Therefore, new industrial production is a key driver of Ukraine’s national economic development amid war, post-war recovery, and global competition. The implementation of the investment balance principle (61.8:38.2) between domestic and foreign investors should become a fundamental regulatory standard for managing national industrial production. At the same time, the authors emphasize the urgent need for investment in science, infrastructure, and education to transition from a raw material-based economy to a production and innovation-based model. It is essential to take into account global trends as a reference point for businesses, which do not exist in isolation. These are the “waves” that can either elevate enterprises or lead them to bankruptcy. To remain competitive, it is crucial to adapt to global shifts — from macroeconomic changes to technological breakthroughs. Accordingly, the integration of Industry 4.0 and Industry 5.0 presents key pathways for modernizing national production and has become both a global and national mainstream agenda. Under these conditions, it is necessary to identify a list of strategic industries requiring state support and to harmonize this list with the vital interests of the population. The development of these strategically important sectors on the basis of innovation should become the foundation of Ukraine’s economic resilience in times of war and global challenges. Moreover, key obstacles to rebuilding the national economy under war conditions and in a highly competitive global environment must be addressed. These include an insufficient basic industrial capacity, inefficient resource use, a weak innovation system, and an underdeveloped institutional environment. In this context, the economic scientific community expresses concern about the threat of excessive cheap Chinese exports, which negatively affect the competitiveness of domestic industry. To counter this threat, we substantiate the importance and necessity of developing innovative industrial production based on the principles of Industry 4.0 and Industry 5.0 as a driver of Ukraine’s economic growth.