Ukrainian Prime Minister Denys Shmyhal announced on Wednesday the formalization of a partnership agreement between Kiev and Washington focused on the development of mineral resources. This document, titled The Agreement on Establishing the Rules and Conditions of the Investment Fund for the Reconstruction of Ukraine, is directly tied to security guarantees, as Ukraine considers these non-negotiable for the agreement's viability.
Under the terms of the agreement, both nations will collaborate to create a joint fund financed by revenues stemming from Ukraine's mineral rents, licenses, and dividends. This fund aims to bolster Ukraine's development, restoration, and security, Shmyhal emphasized.
Reportedly, Ukrainian President Volodymyr Zelensky is set to visit Washington on Friday, where he will meet with U.S. President Donald Trump to solidify the deal, according to the Financial Times. Discussions leading up to this moment have involved negotiations over access to Ukraine’s rare earth minerals, integral to the broader diplomatic efforts concerning the Russia-Ukraine conflict.
A contentious point during these negotiations had been the Trump administration's demand for $500 billion worth of Ukraine’s rare earth minerals as compensation for the aid already provided. This significant figure had initially been rejected by Zelensky. Nevertheless, following the U.S. dropping this insistence, Ukrainian officials expressed readiness to proceed with signing the agreement.
"I hear Zelensky is coming on Friday. Certainly, it's OK with me if he'd like to sign it together with me. And I understand it's a big deal," Trump stated from the Oval Office earlier this week, noting, "Ukraine would receive $350 billion and lots of military equipment, and the right to fight on." This statement highlights the tactical nature of the deal, which not only focuses on minerals but also on military support.
Zelensky has been adamant about securing concrete security guarantees from the U.S. as part of the accord. Ahead of the third anniversary of the conflict, he articulated his reservations about the earlier demand for $500 billion. "What we can tell is Ukraine is dissatisfied with the mineral deal, but eventually it may have to sign," commented Zhang Hong, from the Institute of Russian, Eastern European and Central Asian Studies. He noted Kyiv’s perspective on exchanging resources for security is pivotal, especially considering the importance of U.S. support at this juncture.
On the European side, discussions have sprung up concerning strategic partnerships over minerals as well. Just this week, the European Union proposed another agreement focused on "critical materials" with Ukraine. European Commissioner for industrial strategy, Stephane Sejourne, described it as a potential "win-win" scenario, yet there were mixed messages as EU officials denied having made any formal offer.
The competition between the U.S. and Europe for control of Ukraine's resources raises significant questions. Zhang pointed out the apparent belated nature of the EU's offer. While potentially fairer than the U.S. agreement, the EU's proposal lacks momentum because the U.S. has already established its foothold.
This dynamic, highlighted by criticism from leaders such as German Chancellor Olaf Scholz, indicates the U.S. stands firm on what some view as egotistic policies. Specifically, Stolz labeled Trump's negotiation tactics as "very egotistic, very self-centered, according to Politico, noting the broader geopolitical strategy at play.
Eastern Ukraine contains plentiful mineral resources, which are of high strategic value internationally. This has led experts like Cui Heng from the Shanghai-based China National Institute for SCO International Exchange to recognize Ukraine's resources as key tools not just for economic gain but also for enhancing its foreign policy posture.
Despite the apparent advantages the U.S. agreement offers, questions linger about whether signing it will definitively secure Ukraine's safety. Observations by analysts suggest the Trump administration may prioritize stabilization between the U.S. and Russia at the expense of Ukraine’s enduring security needs.
Signing the agreement may merely maintain the current state of U.S.-Ukraine relations, teetering on the brink of fragility, rather than establishing a firm ground for enduring support or development. Without careful navigation, Ukraine risks its position, potentially exchanging resource control for mere diplomatic gestures.