U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky just completed an expected pact on natural resources. This pact is intended to bolster military guarantees for Ukraine. The agreement, which underscores both nations’ commitment to economic recovery and stability, was signed following a face-to-face meeting between the leaders on the sidelines of Pope Francis’ funeral. There’s no doubt that this partnership is very important. It comes amid continuing fallout from the U.S. trade war with China, which today controls most of the rare-earth industry.
The agreement should be seen as a significant step forward for both countries. Ukraine will provide the United States with access to Ukraine’s vast reserves of critical minerals – including graphite, titanium and lithium. In exchange, Ukraine promises to use any future security assistance it receives from the United States. This new agreement will further support Ukraine’s efforts to recover from the still-ongoing war with Russia. At the same time, it can help secure immense new opportunities for American industries.
President Trump has emphasized the importance of the agreement, stating, “So I went to them and said, ‘Look, we got to get rare earth. They have great rare earth, meaning certain minerals, materials.’” He claimed that this deal was the first step in returning the billions of dollars the U.S. has poured into Ukraine since the war began. He called the $1 billion phased funding as “theory” capable of bringing in much more.
The agreement was early on delayed, in part by last-minute terms suggested by Ukrainian officials. An update on the developing situation. U.S. Treasury Secretary Scott Bessent said that the agreement “demonstrates tangible actions and resolve” to build a lasting peace and prosperity in Ukraine. Furthermore, he underscored that the partnership would be balanced, operating on a 50:50 basis.
Ukraine’s Deputy Prime Minister, Yulia Svyrydenko, was positively buoyed by the deal. She’s convinced it’ll be a draw for foreign investment into Ukraine, from all around the world. This feeling is echoed in the creation of a reconstruction investment fund meant to help Ukraine recover economically. The specificity of this agreement means that it applies to federal projects and endeavors in the realm of minerals, oil, and gas ventures. Most importantly, though, Ukraine will continue to own these resources.
U.S.-Ukraine relations entered a new and exciting phase with last week’s formal signing of the technical documents. The agreement still must be ratified by lawmakers in Kyiv before it can take full effect.
Important economic benefits might be, the value of this new partnership is much deeper. In the context of Russia’s full-scale invasion of Ukraine, there have been assurances that “no state or person who financed or supplied the Russian war machine will be allowed to benefit from the reconstruction of Ukraine.” This second aspect of the agreement aims to bolster international military assistance for Ukraine. It creates the conditions so that both rebuilding efforts don’t accidentally further embolden the very people who caused the country’s grief.
As we all know, the geopolitical landscape is incredibly dynamic right now. For both the U.S. and Ukraine, this agreement marks an important step in the right direction. They want to shore up their defenses against a rapidly emerging, very intense, global competition. They accomplish this by uniting their interests in natural resource sharing and security.