US and Ukraine sealed a mineral agreement; details within:

Fresh Take: USA Inks Deal with Ukraine for Critical Mineral Access 🚀

In a significant agreement, the U.S. and Ukraine have sealed a deal aimed at offering the U.S. access to Ukraine's valuable natural resources. Ukrainian officials called this version of the deal more favorable than previous ones, which they felt gave the U.S. undue rights.

The deal, yet to be ratified by the Ukrainian parliament, includes provisions for establishing a joint reconstruction fund to support Ukraine's economic recovery. This fund, according to officials, should secure ongoing American military support vital in Ukraine's 3-year-old fight against Russia's invasion.

Economy Minister Yulia Svyrydenko, signing for Ukraine, stated, "We've crafted a version of the agreement that benefits both nations. This deal acknowledges the U.S.'s dedication to long-term peace in Ukraine and recognizes Ukraine's role in global security by forgoing its nuclear arsenal."

This signing comes at a crucial juncture for U.S.-led efforts to end the ongoing conflict, which seems to be at an impasse. Ukraine sees this agreement as a means to ensure its biggest ally stays engaged and doesn't halt military aid.

Treasury Secretary Scott Bessent, speaking for the U.S., said, "This agreement sends a clear message to Russia that the Trump administration is committed to a long-term peace process centered on a free, sovereign, and prosperous Ukraine."

What's in the Deal? 💼

The deal primarily addresses critical minerals like rare earth elements, but it also covers oil and natural gas. It doesn't encompass resources already generating revenue for the Ukrainian state. Instead, any profits depend on the success of new investments. Notably, it doesn't oblige Ukraine to settle any outstanding debts.

The deal ensures Ukraine retains ownership of its resources, and the state decides on extraction locations. It also mentions 55 minerals but leaves room for more to be agreed upon. Rare earth elements of interest to Trump, such as lanthanum, cerium, and scandium, are included in the list.

Rare Earth Elements 🌏

These are a group of 17 elements crucial to various consumer technologies, including smartphones, computers, and electric vehicles. China is the world's leading producer, with the U.S. and Europe looking to reduce their dependence on Chinese resources.

The functioning of the Fund 💡

The agreement sets up a joint Reconstruction Investment Fund, with equal management powers for both the U.S. and Ukraine. This fund will be supported by the U.S. International Development Finance Corporation, aiming to attract investments and technology from American and European nations.

Ukraine is expected to contribute half of the future profits from government-owned natural resources into the fund. The U.S. will contribute through direct funds and equipment, including air defense systems and military aid. Contributions will be used to invest in mining, oil, gas, and infrastructure projects.

For the first decade, no profits will be withdrawn from the fund. Previously, the Trump administration had pushed for a deal that would yield $500 billion in mineral profits as compensation for its wartime support, a proposal that was rejected by Zelenskyy.

The State of Ukraine's Mineral Industry 🏗️

Ukraine's untapped rare earth elements are held back by government regulations, a lack of detailed geological data, and the ongoing conflict. Despite these barriers, the outlook for Ukrainian natural resources remains promising, with significant titanium reserves and Europe's largest known lithium reserves—essential for battery production.

In 2021, Ukraine's mineral industry contributed 6.1% to the GDP and 30% to exports. Around 40% of Ukraine's mineral resources are inaccessible due to Russian occupation. Ukraine argues that the U.S. should develop the remaining resources before further Russian advances capture more.

The U.S. government and Ukrainians have reached an agreement, granting the U.S. access to Ukraine's valuable resources, including critical minerals like rare earth elements, oil, and natural gas.
The agreement also mentions 55 minerals, leaving room for more to be agreed upon, and includes a provision for establishing a joint Reconstruction Investment Fund.
This fund will be managed equally by both the U.S. and Ukraine, with the aim of attracting investments and technology from American and European nations.
Ukrainian officials are expected to contribute half of the future profits from government-owned natural resources into the fund, while the U.S. will contribute through direct funds and equipment, such as air defense systems and military aid.
The deal does not oblige Ukraine to settle any outstanding debts, but it does ensure Ukraine retains ownership of its resources and decides on extraction locations.
The deal comes amidst the ongoing conflict between Ukraine and Russia, with Ukrainian officials viewing this agreement as a means to ensure continued U.S. military support and engagement in the region.