Ukraine‘s Economic Divide Widens as War Shifts โInvestment โWest
KYIV, Ukraine – November 6, 2025 – While a lasting peace could offer a path to recovery, the war in Ukraine has dramatically reshaped its economic landscape,โข channeling private investment towards safer western regions whileโ leaving eastern cities like Kharkiv facing an uncertain future. the disparity highlights theโ escalating risks associated with proximity to the conflict and the growing possibilityโ of a permanently fracturedโ Ukrainian economy.
The concentration of โinvestment underscores a fundamentalโข shift inโ Ukraine’s economic priorities. โฃSergeyโ Fursa, deputy director of the investmentโ firm Dragon โCapital, โฃstated that โขhis company is currently โขavoiding any โprojects east of the Dnieper River, signaling โฃa widespread investorโค reluctance โฃto โคengage with areas โขvulnerable to โขongoing Russian aggression. This hesitancy is reflected in construction data: betweenโข January and June of this year, builders commenced 15,559 new homes in the Kyiv โฃregion, 6,956 in Lviv, but a mere 199 in Kharkiv.
analysts suggest that revitalizing heavily damaged cities like Kharkiv will necessitate substantial government intervention, including targeted โขtax incentives scaled to reflect the level ofโ riskโฃ associated with each location. Kyiv is expectedโข to remain a magnet for capital, skilled workers, and population growth, while Odessa’s role as Ukraine’s primary port secures its economic future. however, much of eastern Ukraine risks becoming a struggling “rust belt,” perpetually threatened by the specter โคof renewed conflict.