2 May 2025

USA and Ukraine Sign Minerals Deal

by Bonnie | | 0

After months of often angry negotiations, USA and Ukraine signed an agreement to share proceeds from future sale of Ukraine’s minerals and rare earths.

Previous versions of the deal that Donald Trump insisted upon were structured like a shakedown. This version no longer blocks Ukraine from joining the European Union. It does not literally give ownership of Ukraine’s mineral rights to the USA. Instead it creates a joint US-Ukraine Reconstruction Investment Fund fund to manage proceeds from those mineral rights with a board where each of the two countries has half the seats and each country gets half the proceeds.

Although Trump continued to say the deal will repay the USA for what it has put into Ukraine so far, the deal is actually structured to defray the cost of USA support to Ukraine going forward. It does not try to make Ukraine pay an inflated amount to “reimburse” the USA for far more than it has actually put into helping Ukraine fend off invasion by Russia. Ukraine retains control over its mineral resources, infrastructure, natural resources and state-owned companies. It affects only new investments and projects, not existing ones, and does not create new debt obligations against Ukraine.

Until now, Trump has been turning his back on Ukraine, withdrawing support for the country while applying pressure for it to give in to Russian President Vladimir Putin’s demands. The minerals deal creates a new incentive for Trump to be less eager for Putin to take all he wants from Ukraine. If Russia’s invasion succeeds, Trump would lose the mineral deal he has lusted after ever since his inauguration.

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