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Ukraine and the US have concluded an agreement on the common development of the country's mineral resources through the “Investment Fund for Reconstruction”.
The agreementOn February 25 and the first financial Times, it is much less difficult and sweeping than the initial design of Washington.
An earlier reference to possible income from $ 500 billion from mineral extraction was canceled. There is also no explicit warranty of the US Ukrainian security that Kyiv wanted in return for sharing profits from his valuable natural resources.
While Ukrainian negotiators were able to narrow The agreement and pushing back to some of the most difficult conditions required by Trump administration have to decide on several fundamental details.
Where will the income from the Ukrainian extraction of minerals go?
Kyiv and Washington will set up a “joint investment fund” to which Ukraine They will pay 50 percent of all income obtained from the “future monetization” of natural resources owned by the Ukrainian government.
Theoretically, the fund will invest in post -war reconstruction and economic development of Ukraine, potentially in all sectors not only of natural resources.
Will the US own and control the fund?
It will jointly own and manage the US and Ukrainian governments, but there will be other details on the ownership and administration of public affairs at a later stage of the “Fund” Agreement. In its introductory offer, the US promoted 100 % ownership and full decision -making rights.
Instead, the agreement states that “the maximum percentage of the fund's capital” holding the US and the “decision -making” will be “to the extent permissible under US law”. It may be because US agencies can face the limits of their participation in such a fund.
For example, if it were the US Development Finance Finance, which managed the US interest in this fund, according to existing legal regulations, its investment in capital would be limited to 30 % of the ownership of any project.
Neither the US nor Ukraine will be able to sell any share of the fund without the consent of the other.
Will the revenues be invested in Ukraine or paid to the US?
This is also vague and will be decided in the fund agreement.
The agreement states that the fund will collect and re -invest the income “at least a year in Ukraine to support the security, security and prosperity of Ukraine”.
However, it does not consider that all incomes will be reinvested and adds that the subsequent agreement on the fund “ensures future division”.
What are the Ukrainian resources apply to the agreement?
Ukraine has large deposits of critical minerals, including lithium, graphite, cobalt, titanium and some rare countries. It also has oil, gas and coal reserves. This is subject to an agreement – if the Ukrainian government – and related logistics owned “directly or indirectly”.
However, deposits that already contribute to government cash registers in taxes, license fees or license fees are not covered by an agreement. This would eliminate the current operations of Skrnafta and Naftogaz, state oil and gas companies, which are perhaps the most lucrative of all Ukrainian extraction industries.
Ukraine deposits have also not undergone significant survey or development – processes that last for years in stable jurisdictions. The quality of reserves also lack data, which is essential for investors than millions of new mines. Much of the deposits lie in the territory dominated by Russian forces.
Using critical minerals of Ukraine would require huge investments. The fund could theoretically finance some of them, but starts from scratch if the US actually puts money in advance. It would also take years for the projects to provide taxable operating profits.
Did Ukraine receive a security guarantee it required?
US President Donald Trump described the Mineral Agreement as a way to get a “return” for previous American assistance to Ukraine. He was worried around huge revenue from the system, from $ 350 billion to $ 500 billion. Given the difficulties in commercializing these deposits, it is likely that it would only bring a fraction.
Trump's administration claimed that the mere presence of US economic interests in Ukraine would be enough to prevent future Russian military aggression. President Volodymyr Zelskyy demanded clearer guarantees of future US military assistance and security guarantees in the agreement. He didn't get them.
“It does not contain all the security guarantees that Ukraine wanted, but I wanted to mention at least one sentence of the warranty – and it is there,” he said on Wednesday.
The Head of Ukrainian officials involved in the negotiations said FT that they were under great pressure from Trump's administration to complete the agreement.
They hope that if Zeletskyy and Trump sign it on Friday in the White House, it could open the door to more detailed interviews about military assistance and other warranty under the pressure of the US President to end the Russian War.
Another report of Joseph Cotterilla
