Washington, US:
The United States and Ukraine have agreed on the terms of a draft minerals deal to turn over Kyiv’s revenue from some of its mineral resources to Washington, after an intense pressure campaign from President Donald Trump. The agreement could be signed as early as Friday when Ukrainian President Volodymyr Zelensky visits Washington to meet his American counterpart.
President Trump, who seeks to rapidly end the war with Russia, has demanded that Ukraine give access to its rare earth minerals to compensate for the billions of dollars of wartime aid it received under Joe Biden. The deal came after the two leaders exchanged hostile words last week after America’s dramatic policy shift that includes reaching out to Russia.
President Trump told reporters that Mr Zelenskiy wants to come to Washington on Friday to sign a “very big deal.”
A Look Inside The Deal
The exact details of the deal are not yet known, but the draft agreement discussed on Tuesday did not include a clause requiring Ukraine to pay back the United States twice the amount of any future American aid.
Under the terms of a draft minerals agreement, the United States and Ukraine would establish a Reconstruction Investment Fund–that would be “joint for Ukraine and America”– to collect and reinvest revenues from Ukrainian sources including minerals, hydrocarbons and other extractable materials, news agency Reuters reported quoting sources familiar with its contents of the deal.
Ukraine would contribute to the fund 50 per cent of the revenue minus operating expenses and continue until the contributions reach the sum of $500 billion. In exchange, the United States would continue providing a long-term financial commitment to the development of a “stable and economically prosperous Ukraine.”
Per the Reuters report, the deal does not specify any American security guarantees or continued flow of weapons but says that the United States wants Ukraine to be “free, sovereign and secure.” it said that future weapons shipments are still being discussed between Washington and Kyiv.
However, AFP reported that the draft of the deal does include a reference to “security”, but did not explicitly set out the United States’ commitments — one of Kyiv’s prior demands for an agreement.
“There is a general clause that says America will invest in a stable and prosperous sovereign Ukraine, that it works for a lasting peace, and that America supports efforts to guarantee security. Now government officials are working on the details,” AFP reported quoting a source.
The AFP report also said Washington had cut the $500 billion reference. “They removed all the clauses that did not suit us,” the source said.
What’s Trump Said?
Asked what Ukraine would get in return for the minerals deal, Mr Trump cited what he said was $350 billion already provided by the US “and lots of … military equipment and the right to fight on.”
“What we’re doing is now we’re saying, look, we want to be secured,” Mr Trump said. “The American taxpayer now is going to get their money back, plus.”
He also said some form of peacekeeping troops are needed in Ukraine if an agreement to end the conflict is struck. Moscow, which launched an invasion of Ukraine three years ago, has refused to accept any deployment of NATO forces.
Some European countries have said they would be willing to send peacekeeping forces to Ukraine. Mr Trump said on Monday that Moscow would accept such peacekeepers, but the Kremlin denied that on Tuesday.
Zelenskiy refused to sign an earlier draft of a minerals agreement as Washington sought rights to $500 billion in Ukraine’s natural wealth. Kyiv protested it had received far less than that in U.S. aid and the deal lacked the security guarantees Ukraine needed.
What’s At Stake?
The deal could open up Ukraine’s vast mineral wealth to the US. Kyiv controls over 100 major deposits of critical minerals, including Titanium, Lithium, Uranium and rare earth metals, according to a study by the Kyiv School of Economics, along with modest oil and natural gas reserves.
Titanium mines in central Ukraine account for about 6 per cent of global production, according to Ukrainian media. The metal is used in construction, aeroplanes, orthopaedic implants and as an additive in paint and cosmetics.
Ukraine has a third of Europe’s total Lithium reserves, although some sites are in war-contested areas. Lithium is a crucial element in batteries.
Ukraine has Europe’s largest uranium reserve, which is used in nuclear power plants and nuclear weapons.
Ukraine also has substantial reserves of rare earths that are mostly untapped, and it is unclear how expensive they would be to extract. Rare earths are a group of more than a dozen metals, much less abundant than titanium or lithium, that are used in many high-tech sectors.