PRIORITIZATION OF SOCIAL INFRASTRUCTURE RECONSTRUCTION INVESTMENT PROJECTS IN UKRAINE UNDER FISCAL CONSTRAINTS
Abstract
The article examines the theoretical and methodological foundations of prioritizing investment projects for the social infrastructure reconstruction in Ukraine under wartime fiscal constraints. Based on an analysis of the state budget expenditures dynamics and comparison of reconstruction needs (according to the Fourth Rapid Damage and Needs Assessment – RDNA4) and the financial capabilities of the Unified Public Investment Portfolio, a systemic funding deficit, structural budget and donor resources limitations were identified. The results of the study demonstrate a sharp decrease in the social spending share in the state budget since 2022, along with a significant increase in defense spending and growing dependence on external financial assistance, which together narrowed the fiscal space for capital investments in social sectors in Ukraine. To eliminate these limitations, the article substantiates the need for a formalized and transparent investment projects prioritization mechanism. In this regard an integrated scoring model is developed and proposed in the article. It combines direct physical damage, estimated reconstruction needs, indirect economic losses, socio-demographic pressure indicators (including the internally displaced persons concentration). The model also includes the project institutional score within the Unified Public Investment Portfolio. Model performance indicator applies normalization procedures and a nonlinear amplification mechanism for critically affected regions, ensuring sensitivity to spatial asymmetry and social risks. The scoring model implementation allows for objectively ranking projects, aligning regional reconstruction needs with national strategic priorities and increasing the allocation of limited public investment resources efficiency. By transforming socio-economic parameters into a single integrated assessment of priority, this approach increases transparency, comparability and adaptability of investment decisions in chronic budget constraints conditions and post-war reconstruction challenges.
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