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The purpose of the article is to analyze the state of innovative development of the economy of Ukraine and the countries of Central and Eastern Europe and to identify the problems of its provision in the conditions of martial law. The results of the study prove that factors of a military nature have an ambiguous effect on stimulating the innovative development of the country's economy. It has been established that economic evolution through innovation is a prerequisite for strengthening its competitiveness in countering modern challenges and threats. The results of the empirical study made it possible to find out that during the large-scale aggression of Russia on the territory of Ukraine in 2022, a decrease in the level of innovative economic development was also observed in the countries of Central and Eastern Europe. It was established that in 2023, the countries of the analyzed group managed to increase the indicators of innovative activity of business entities and the parameters of the innovative development of the economy. Important problems in ensuring economic progress through innovative activity have been identified: (1) shortcomings of the legislation regulating the innovation sphere; (2) lack of formation of a unified innovation infrastructure; (3) significant tax burden; (4) lack of an effective system of taxation and provision of tax benefits and preferences; (5) lack of effective investment mechanisms in the field of innovation; (6) low level of technological capacity of production facilities; (7) imperfection of the education system; (8) low level of financing of research activities; (9) focus on the export of raw materials and dependence on high-tech imports. In order to ensure sustainable innovative development of the country's economy, it is necessary to create appropriate conditions for the development of innovative potential, activate the creation of cross-border innovation clusters, and strengthen the country's investment attractiveness.
Blikhar et al. (Sun,) studied this question.