Like the rest of Europe, Lithuania is facing challenges attracting foreign investment from 2024 onwards. Geopolitical instability, competition between countries, and growing global tensions are changing corporate expansion strategies, investment priorities, investor values and behavior patterns (Incekara and Incekara, 2025; Yu and Wang, 2023; Lutfi et al., 2022). The changed perception of global stability (Choudhury, 2025; Incekara and Incekara, 2025) is fundamentally changing the movement of capital flows (Zokirov and Parsons, 2025). For more than five years in a row, geopolitical risk has been ranked among the top three global threats in the World Economic Forum’s annual Global Risks Report. The World Economic Forum’s 2025 Global Risks Report highlights that the main threats currently include military conflicts, environmental challenges, and the spread of disinformation (Elsner et al., 2025).
In the context of contemporary transformations, the approach of investors, which was previously focused solely on cost reduction and profit maximization, is changing due to new priorities in choosing investment locations. Investors’ decisions on choosing a country for investment have become complex and increasingly dependent on dynamically changing factors (Gold and Tregenna, 2024; Lu and Liu, 2024; Nguyen et al., 2025) and are focused not only on factors that determine a region’s resources (geographical location, minerals, land, transport, etc.), but also on the ability to react and make flexible decisions (Akpilic, 2025). In an environment of constant global uncertainty, foreign investors tend to direct capital flows to countries that are considered safe, resilient to global challenges, characterized by geopolitical risk management practices, and distinguished by a strong international reputation and effective communication (Jardet et al., 2023; Y?lmaz, 2024; Yu and Wang, 2023; Karpushenko et al., 2024).
Lithuania’s situation is unique due to its geographical location. Following Russia’s aggression against Ukraine, regional security needs have increased, prompting Lithuania to strengthen its defense industry and technological independence. Scientists recognize that the development of the defense sector shapes the country’s security image in the eyes of foreign investors. The defense technology (MilTech) sector is becoming not only a guarantor of national security for Lithuania, but also a strategic economic priority, as investments in defense technologies reduce dependence on imports and increase resilience to geopolitical risks.
The aim of the study is to assess the impact of the development of the Lithuanian defense technology sector on attracting investment in the context of contemporary changes.
The scientific problem is whether the development of the MilTech (defense technology) sector can become a catalyst for Lithuania’s investment attractiveness.
Research methods: comparative analysis and systematization of scientific literature, content analysis and generation of conclusions, analysis of official statistical data, correlation and regression analysis.
Objectives:
1. Analyze the latest scientific research on how contemporary uncertainties affect investments in different economic sectors and the factors identified by scientists that determine the attraction of investments in conditions of contemporary uncertainty. Result – identify factors that influence the investment attractiveness of different economic sectors.
2. Perform content analysis – evaluate media reports, strategic documents, and reviews. Research methods – systematic document analysis, logical conclusion generation. The result – an analysis of Lithuania’s strategic area financing guidelines and an assessment of the transformation of attractiveness and positioning for investors in the context of ongoing changes.
3. Perform econometric analysis. Research methods – collection and systematization of statistical indicators, trend analysis, correlation and regression analysis. Period: 2014–2025 (2024). Result: identification of factors characterizing and determining the development of the defense sector, collection of a database of indicators, and performance of an econometric study to assess the impact of the development of the defense technology sector on attracting investors to Lithuania.
Project results:
The study will highlight the factors presented in the latest scientific literature for attracting foreign investment to different sectors (high technology, manufacturing, defense, information technology and Fintech, energy, etc.) in the context of contemporary changes, which will allow for a comparison of how changing circumstances affect the attraction of investors. It will also analyze trends in Lithuanian investment in different sectors and model how the development of the defense sector and the innovation and technology ecosystem may affect the attraction of investors – whether it is a guarantee of security and Lithuania’s reliability for investors.
The analysis of scientific literature will be supplemented by content analysis: evaluation of media reports, strategic documents, and reviews. This will reveal the guidelines for financing Lithuania’s strategic areas and assess the transformation of attractiveness and positioning for investors in the context of ongoing changes. Econometric analysis will allow us to assess whether the ongoing development of defense technologies is related to attracting investors and increasing Lithuania’s investment attractiveness.
Period of project implementation: 2026-07-01 - 2026-08-31
Project coordinator: Kaunas University of Technology
