U.S. and Ukraine reach minerals deal; experts warn of exploitative nature

Ukraine said on Wednesday that it had reached a framework agreement with the United States on jointly developing Ukraine's natural resources including rare earths, critical minerals, oil and gas.

U.S. President Donald Trump said during a cabinet meeting on Wednesday that Ukrainian President Volodymyr Zelenskyy would travel to Washington on Friday to sign the mineral agreement, while the Ukrainian leader said the success of the deal would hinge on those talks and continued U.S. aid.

Zelenskyy, speaking in his nightly video address, said he would stress the importance of obtaining security guarantees during his talks with Trump and added that continued U.S. aid was vital. "For me and for all of us in the world, it is important that American aid is not halted. Strength is needed on the path to peace," he said.

So far, the Ukrainian side has received no U.S. security guarantees. "I'm not going to make security guarantees beyond very much," Trump said on Wednesday. "We're going to have Europe do that."

Ukrainian Prime Minister Denis Shmyhal described Wednesday's agreement as "preliminary." He emphasized that the agreement encompasses several key points: Firstly, Ukraine and the U.S. will establish a reconstruction investment fund, which will be jointly owned and managed by both governments. Importantly, Ukraine's underground mineral and natural resources will remain under Ukrainian control and will not be transferred to the U.S. or any other country. 

Additionally, Ukraine will allocate 50 percent of the future income from its natural resource assets to the fund. The U.S. in turn, will contribute financial resources, financial instruments and other assets critical to Ukraine's reconstruction efforts. The funds raised will be dedicated exclusively to Ukraine's reconstruction projects. 

Finally, the agreement takes into account Ukraine's obligations within the framework of European integration, ensuring that it does not conflict with or undermine Ukraine's European integration commitments.

Expert: The U.S. is 'exploiting natural resources from a small country'

Some experts warned that the essence of the deal was the U.S., as the super world power, exploiting natural resources from a small country. 

Chen Yu, deputy director of the Eurasian Studies Institute at the China Institute of Contemporary International Relations, told CMG that the U.S. has made some concessions in terms of wording and other aspects of the agreement to make it more acceptable to Ukraine, but the substance remains unchanged.

"This agreement, compared to the high demands previously made by the U.S., does not represent a fundamental shift. For example, the U.S. still requires Ukraine to allocate 50 percent of revenues from minerals, energy and other resources to this fund, and it stipulates that Ukraine cannot sell its share or alter its terms without U.S. consent," Chen said.

He argued that the agreement represents a U.S. attempt to economically control Ukraine and seize its mineral resources. For Ukraine, which is at a disadvantage in the ongoing power struggle, it is left with little choice but to accept, said Chen.

"Ukraine's goal is to use this agreement to repair its relationship with the U.S. as much as possible, in hopes of securing a position in future Russia-Ukraine peace negotiations. This, I believe, is likely the reason Ukraine is willing to sign this agreement," Chen added.

In an editorial, The Washington Post warned that the new U.S. administration has upended nearly a century of American foreign policy, ushering in a return to an era where powerful nations extract tribute from weaker ones and expand their territories through coercion.

(With input from Reuters)