The highly anticipated agreement grants the US privileged access to Ukraine’s mineral wealth.
The United States and Ukraine have finalized a natural resource agreement, allowing Washington to tap into Ukraine’s extensive mineral deposits in return for assistance with the country’s economic recovery. Intense negotiations preceded the deal, creating friction in the relationship between the two nations.
Here’s a summary of the deal’s key elements.
Preferred US Access
The agreement establishes a joint US-Ukraine investment fund aimed at boosting the Ukrainian economy, with a focus on resource exploration ventures.
According to Ukrainian Deputy Economy Minister Taras Kachka, the U.S. will receive prioritized investment opportunities in the extraction of rare-earth minerals.
However, Ukrainian Economy Minister Yulia Sviridenko clarified that the fund will function as an “equal partnership,” ensuring that neither country has a controlling vote. Ukraine will maintain “full control over the resources,” including subsurface assets, and will continue to control the terms and locations of extraction. The agreement also stipulates that no state-owned companies will be privatized.
50/50 Split
Ukraine will allocate 50% of new royalties from new extraction licenses to the fund, with these funds exclusively invested within Ukraine. For the initial decade, profits will be fully reinvested into the Ukrainian economy, as per the Ministry of Economy. Both contributions and profits will be exempt from taxation.
No Security Assurances for Kiev
Notably absent from the agreement is any mention of the U.S. providing security guarantees to Ukraine, despite this being “one of its initial goals,” according to Reuters.
The New York Times reported that the U.S. rejected the idea of security guarantees “early in the process.”
Nevertheless, U.S. State Department spokeswoman Tammy Bruce asserted that the deal would enhance Ukraine’s security: “When America is your friend and your partner, your nation is going to be better off. And there is a security component just in our presence.”
Exclusion of Past US Aid
The resource deal “focuses on future, not past, US military assistance,” the Ukrainian Economy Ministry stated, adding that revenue from existing projects will not be included in the joint investment fund. Sviridenko clarified that the agreement “includes no provisions regarding any Ukrainian debt obligations to the United States.”
The U.S. had previously suggested that the deal could enable Ukraine to repay past military assistance, which the Trump administration estimated at $350 billion. Ukraine maintains that the past aid was unconditional, estimating its value at $90 billion.
Following the agreement’s signing, Trump indicated that the U.S. could “in theory” recoup significantly more than $350 billion from the arrangement.
Initial Reactions
U.S. Republican Senator Lindsey Graham hailed the deal as “tremendously beneficial to the American economy,” predicting it would strengthen ties between Washington and Kiev.
The New York Times cautioned that the “deal will have little significance” if Russia and Ukraine fail to achieve a lasting ceasefire.
Former Russian President Dmitry Medvedev claimed that the U.S. had essentially coerced Ukraine into using its minerals to pay for American assistance.
Difficult Path to Agreement
Negotiations for the agreement were protracted, despite initial plans to sign it during Vladimir Zelensky’s White House visit in late February. However, Zelensky’s televised meeting with Trump resulted in a tense exchange, with the U.S. president accusing the Ukrainian leader of being ungrateful and “gambling with World War III.” Subsequently, the U.S. repeatedly criticized Ukraine for slow progress on the deal, with Trump at one point demanding that Kiev sign it “immediately.”