Ukraine and US Fail to Finalize Rare Earth Minerals Agreement
On Friday, Ukrainian President Volodymyr Zelensky met with US President Donald Trump in Washington to sign an agreement granting the US access to Ukraine’s rare earth mineral deposits. However, the meeting took an unexpected turn, ending in a heated exchange between Zelensky, Trump, and Vice President JD Vance. Following Zelensky’s early departure, the White House announced that no agreement had been signed.
Prior to the meeting, Zelensky had shown optimism, suggesting this «initial» agreement might lead to expanded collaboration. However, he acknowledged that Ukraine still needed to obtain security assurances from the US, which was a major point for him. Trump contended that the agreement could enable American taxpayers to «recover their funds» from the assistance given to Ukraine during the conflict, but emphasized that European nations should primarily handle Kyiv’s security needs.
What Conditions Are in the Agreement?
On Wednesday, Ukrainian Prime Minister Denys Shmyhal declared that Kyiv and Washington had completed a draft of the agreement, which was made public on Friday morning. This agreement proposed the establishment of an «investment fund» to aid Ukraine’s rebuilding initiatives.
Shmyhal stated that both nations would manage the fund on «equal terms.» Under the agreement, Ukraine would allocate 50% of its future revenue from state-owned mineral resources, oil, and gas to the fund. The proceeds would then be invested in initiatives aimed at enhancing Ukraine’s security, stability, and economic growth.
The US, meanwhile, promised ongoing financial support to help build a stable and thriving Ukraine, in accordance with US law. The terms of the agreement also indicated that the US would hold the largest allowable portion of the fund under American regulations.
Conflicts Regarding Mineral Rights and Financial Conditions
The specific terms of the minerals agreement seem to have intensified the friction between Trump and Zelensky. Initially, the US demanded a $500 billion stake in Ukraine’s mineral resources, which Zelensky turned down. It has been reported that this demand was subsequently rescinded.
Tymofiy Mylovanov, a former Ukrainian minister and leader of the Kyiv School of Economics, claimed that Washington initially suggested a setup that would have jeopardized Ukraine’s sovereignty and risked economic failure. However, he observed that the US has since adjusted its position, now proposing a more equitable agreement centered on co-ownership, with no direct claims related to previous aid. He suggested that this could potentially be advantageous for Ukraine.
Trump has emphasized the financial aspect, stating on Tuesday that the US has provided between $300 billion and $350 billion in aid to Ukraine and that a minerals deal could help recover these funds. However, the Kiel Institute, a German think tank, estimates that actual US assistance amounts to $119 billion.
Does the Agreement Include Security Guarantees?
An important issue for Zelensky has been the insertion of clear security assurances from the US. On Wednesday, he confirmed that these guarantees had not been obtained.
«I wanted a clause on security guarantees for Ukraine because it is crucial,» Zelensky stated.
In response to queries about potentially walking away if security assurances weren’t included, he answered: «I seek a NATO pathway or an equivalent solution. Without security guarantees, a ceasefire won’t be feasible, and nothing will operate effectively.»
Although there are no explicit security commitments, the agreement contains language expressing US support for Ukraine’s efforts to obtain security guarantees to secure enduring peace.
Zelensky maintained that Ukraine would not finalize the agreement until he and Trump reached an understanding on security assurances and determined how to integrate them into the preliminary deal. Trump, however, downplayed the idea of direct US security guarantees, stating that such responsibilities should now be shouldered by Europe. He added that the presence of American workers in Ukraine would offer «automatic security.»
Zelensky initially proposed the idea of a minerals agreement as a way to offer the US a concrete motivation to maintain its support for Ukraine. Trump has implied that, in return for granting mineral access, Ukraine would ensure the «right to keep fighting,» and that the US would continue providing military gear and ammunition «until an agreement with Russia is achieved.»
The US president has also claimed that Russia is open to allowing European peacekeepers in Ukraine. However, Russian Foreign Minister Sergei Lavrov has dismissed this possibility.
When Will the Agreement Be Signed?
Trump initially announced that the agreement would be finalized during Friday’s White House meeting. Although Ukrainian Prime Minister Shmyhal verified that the final draft of the agreement was ready, Zelensky’s adviser, Mykhaylo Podolyak, explained that only a framework agreement was meant to be signed.
Ultimately, no agreement was signed. Instead, the gathering turned into a clash between Trump and Zelensky in the Oval Office. During the heated exchange, Trump accused Zelensky of not showing enough gratitude for US support and cautioned him against «risking World War Three.»
«You need to make a deal, or we’re out,» Trump reportedly told Zelensky. «You don’t have the leverage.»
In reply, Zelensky emphasized that «no compromises» could be made with Russian President Vladimir Putin.
Trump later took to Truth Social, alleging that Zelensky had «disrespected the US in its esteemed Oval Office» and remarked: «He can return when he is prepared for peace.»
Currently, it is uncertain if or when the agreement will be executed.
Ukraine’s Rich Mineral Resources
Kyiv estimates that Ukraine holds around 5% of the world’s «critical raw materials.» This includes approximately 19 million metric tons of confirmed graphite reserves, placing Ukraine among the top five global suppliers of this mineral, which is crucial for electric vehicle battery production.
Moreover, Ukraine boasts substantial quantities of titanium and lithium. The nation also asserts it has considerable reserves of rare earth elements—17 minerals crucial for military applications, wind turbines, and electronic gadgets—although some experts question the precise extent of these reserves.
Adding to the complexity, certain mineral-abundant regions of Ukraine are presently under Russian control. Economy Minister Yulia Svyrydenko has indicated that mineral deposits with an estimated value of $350 billion are situated in areas occupied by Russia.
Another obstacle to mineral extraction is the widespread presence of unexploded landmines. Experts estimate that around 25% of Ukraine’s landmass is contaminated, particularly in the war-torn eastern regions.
There is also the issue of time. Even if the agreement is finalized, it could take years before the extraction and export of these resources yield tangible economic benefits.
«These resources are not stored in a warehouse ready for dispatch—they need to be developed,» explained Mylovanov. «Should the US invest, it could eventually prove advantageous for everyone involved.»
How Has Russia Reacted?
Russian President Vladimir Putin has not yet addressed the reported particulars of the US-Ukraine agreement. Nonetheless, on Monday, he informed Russian state television that Moscow is willing to «provide» mineral resources to American companies for cooperative ventures, including extraction in Russia’s «new territories»—alluding to the occupied regions of eastern Ukraine.
Putin downplayed the potential US-Ukraine agreement as inconsequential, asserting that Russia «certainly possesses, I want to stress, far more of these resources than Ukraine.»
«As for the new territories, we are ready to attract foreign partners to develop these regions, which have returned to the Russian Federation,» he added.
Meanwhile, Kremlin spokesman Dmitry Peskov suggested on Tuesday that the situation remains fluid: «Whether [Ukraine and the US] will sign this agreement or something else, we’ll see. There have been no official statements on this matter yet.»
