The US and Ukraine have formalized an agreement that opens the door for American access to some of Ukraine's vast natural resources, a crucial development given the protracted conflict with Russia. This investment fund, months in the making, is designed to solidify US support as Ukraine continues its battle against Russian aggression, marking the third year since the invasion. While the ultimate text of the agreement remains undisclosed, insights and previous drafts reveal several crucial points.
One notable aspect is the absence of demands for Ukraine to repay the perceived $350 billion (£264 billion) in US aid, a previous contention by former President Trump. Prime Minister Denys Shmyhal confirmed that the deal does not require any financial "repayment" from Ukraine, signaling a concession from the US.
Furthermore, Trump has framed the agreement as advantageous to the US, claiming that the country would benefit "much more in theory" than the financial assistance given.
Additionally, the tone from the US towards Russia is markedly firmer, with Treasury Department statements clearly referencing "Russia's full-scale invasion" and promising that no party aiding the Russian war apparatus will benefit from Ukraine's reconstruction. This decisive approach seeks to reassure Ukraine while exerting more pressure on Moscow amidst discussions of a potential ceasefire.
Notably, while discussions predominantly highlight Ukraine's mineral wealth, the deal encompasses plans for new oil and gas projects, retaining Ukrainian ownership of the resources despite joint access for the US. This represents a shift from previous proposals, reflecting a move towards collaboration.
Concerns lingered within Kyiv regarding potential conflicts with EU accession amidst fears that preferential treatment for US investors could stall its EU membership ambitions. However, the agreement acknowledges Ukraine's aspirations to join the EU and indicates a willingness for the US to negotiate adjustments as needed, supporting Ukraine with additional investments and technology transfers.
A significant portion of the investment fund’s profits—fully reinvested into Ukraine's economy for the first decade—signals a period of sustainable growth without immediate financial gain for the US. Treasury Secretary Scott Bessent describes this as a partnership that enables the US to partake in Ukraine's recovery while securing weapons and compensation.
The deal's orchestration suggests that continued military assistance from the US hinges on this arrangement. Ukrainian officials have indicated that it will involve further contributions from the US, including air defense systems, although uncertainty remains over the nature of US commitments moving forward.
While this agreement marks a pivotal moment in the US-Ukraine relationship, questions persist regarding its impact on the broader war dynamics and ultimate military guarantees, reflecting an still ambiguous future regarding US support under the current administration. The Kremlin has yet to respond to the agreement, leaving many unanswered questions in its wake.
