The United States and Ukraine have inked an accord granting Washington access to certain natural resources of the conflict-ravaged nation. Finalized after months of negotiations, this pact establishes an investment fund designed to fortify U.S. support as Ukraine continues to fend off Russian aggression, three years post-invasion. Below are seven pivotal insights derived from this agreement.
Absence of Ukrainian Repayment Obligations to the U.S.
Formerly, Trump insisted that Ukraine reimburse the $350 billion in aid purportedly extended by the U.S. throughout the conflict—a demand rebutted by Zelensky. However, the U.S. appears to have compromised. Ukrainian Prime Minister Denys Shmyhal affirmed that the pact does not mandate Ukraine to repay any alleged “debt.” Trump has framed the agreement as advantageous to his administration as well, asserting that the U.S. will recover “far more in theory” than the financial aid furnished to Ukraine under Biden’s tenure.
Stricter U.S. Stance Towards Russia
The terminology employed by the U.S. in announcing the deal evinces a more robust position against Russia than usually observed from the Trump government.
Key Points:
- The accord references “Russia’s comprehensive invasion”.
- The U.S. Treasury Department emphasizes that “no entity or individual financing or supplying the Russian war machinery will profit from Ukraine’s reconstruction.”
- This stance is likely to boost Kyiv’s morale, which has advocated more pressure on Russia in dialogues between Moscow and Washington regarding a potential armistice.
Inclusion of Oil, Gas, and Minerals
While much of today’s discourse centers on Ukraine’s mineral reserves, the accord also addresses oil, natural gas, and other hydrocarbons. In all instances, resources remain under Ukrainian jurisdiction, though the U.S. obtains joint access.
Notable Developments:
- This inclusion signified a concession by Ukraine, as it was originally absent from earlier versions of the deal.
Unimpeded Path for Kyiv’s European Union Aspirations
Ukraine has long harbored ambitions to join the European Union, with accession discussions formally initiated last June. Kyiv initially voiced apprehensions that the resources deal might obstruct Ukraine’s EU membership, particularly if it privileged U.S. investors, as Kyiv and Brussels already have a strategic alliance on raw materials.
The deal’s text acknowledges Ukraine’s EU membership aspirations and the necessity for this accord not to conflict with them. It also pledges that if Ukraine must renegotiate the deal’s terms due to “additional responsibilities” stemming from EU membership, the U.S. will engage in good-faith negotiations.
Kyiv also states that the U.S. will back further investment and technology transfers to Ukraine, including from the EU and other regions.
Revival of U.S. Military Engagement…
The U.S. frames this deal as vital for Ukraine’s continued receipt of military aid. Ukrainian First Deputy Prime Minister Yulia Svyrydenko, who journeyed to Washington D.C. to sign the accord, stated it envisions future U.S. assistance, such as air defense systems. This represents a strategic shift for Trump, who has sought to curtail military support for Ukraine since regaining the presidency.
An unresolved question persists: how this agreement will ultimately influence the war’s trajectory. The Kremlin has yet to respond to the accord.
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…But U.S. Retains Option to Withdraw
Apparently, there are no substantial security assurances from the U.S., a point Ukraine and Europe have long urged the White House to offer. Trump has been averse to matching Biden’s military commitments.
Instead, Trump’s motivation to sustain U.S. support is more tacit, predicated on the economic pledges laid out in this accord. Consequently, the commitment of Ukraine’s paramount ally still carries an element of instability.
Reinvestment of Profits Within Ukraine?
One noteworthy aspect underscored by Ukraine’s government is that for the inaugural decade of the reconstruction investment fund, profits will be “entirely reinvested in Ukraine’s economy”—either in new ventures or reconstruction efforts. This could hold substantial implications if there is no financial remuneration for the U.S. during this period. However, this clause does not appear in the Washington-signed agreement, though it might be part of a subsequent “technical” deal.
Post this initial 10-year span, Kyiv indicates that profits could be distributed among the partners. U.S. Treasury Secretary Scott Bessent told Fox News that the deal signals to Americans that “we have an opportunity to engage, secure some of the funding and weapons, compensation for those and be collaborators in the prosperity of the Ukrainian populace.”