On 30 April 2025, the United States and Ukraine signed an agreement to establish the United States-Ukraine Reconstruction and Investment Fund. This fund aims to jointly invest in Ukraine’s natural resources, including critical minerals, oil, and gas, to support Ukraine’s post-war reconstruction efforts. While the deal significantly differs from the demands made by President Donald Trump, it is expected to grant Washington preferential access to Ukraine’s critical mineral resources. Ukraine has described the agreement as an “important milestone” in its strategic partnership with the U.S., while U.S. officials called it a “historic economic partnership”. Although presented as a step forward in economic cooperation, the deal has sparked debate over its potential geopolitical implications, particularly its role in recalibrating the relationship between the Trump administration and Ukraine.
What is the U.S.-Ukraine Minerals Deal?
Although factually incorrect and rejected by Ukraine’s President Volodymyr Zelensky, President Trump has repeatedly asserted that Ukraine must repay $350 billion (and at times claimed $500 billion) it has received as aid from the U.S. since the Russia-Ukraine war began. Based on this exaggerated claim, Trump frequently demanded that Ukraine sign a profit-sharing critical minerals deal with the U.S. as compensation for aid provided. The U.S.-Ukraine mineral deal has emerged against the backdrop of this contentious demand.
President Zelensky rejected earlier drafts of the deal, arguing that he cannot sign an agreement that would risk ten generations of Ukrainians. He demanded a fair deal that would also include a U.S. security guarantee. However, President Trump rejected “security guarantees” and ruled out the possibility of Ukraine becoming a NATO member; eyeing an economic partnership without any security commitments.
It was expected that Zelensky would sign the deal during his visit to Washington in the last week of February 2025. However, this meeting ended abruptly following tense exchanges between the U.S. and Ukrainian leaders.
The deal that was eventually signed does not mention Ukrainian debt to the U.S. or demand any repayment of the aid received. Although Washington allowed this concession, President Trump claimed that the deal would give back the U.S. “much more in theory”.
As made clear by President Trump, the agreement does not provide any security guarantees. It asserts a long-term strategic partnership between the two nations and pledges U.S. support for Ukraine’s “security, prosperity, reconstruction, and integration into global economic frameworks”.
The agreement states that the “Reconstruction Investment Fund” will be jointly managed by the U.S. and Ukraine in equal partnership. It does not provide any provision to consider past U.S. assistance as a contribution to the fund. However, it is agreed that future military aid from the U.S. will be counted as a contribution to the fund. From the Ukrainian side, half of the revenues from all newly issued licences for projects in the field of critical minerals, oil and natural gas will go to the fund. The deal will not affect the revenue Ukraine is currently earning from already launched projects.
Ukrainian officials clarified that, for the first ten years, the fund’s resources will be exclusively invested in Ukraine, ensuring sustained U.S. support for its economic growth and innovation. After this period, profits may be distributed between the two partners.
Though it is generally referred to as a mineral deal, it also includes provision for oil, natural gas, and other hydrocarbons. Meanwhile, the agreement is largely focused on rare earth minerals such as uranium and lithium and does not mention common metals like iron, which are abundant in Ukraine.
Unlike earlier claims about the U.S. colonisation of Ukraine’s economy and interference in its sovereignty, the deal affirms Ukrainian ownership of the resources, subsoil and infrastructure, although it grants the U.S. joint access. The authority to decide where and which minerals can be extracted remains with Ukraine. Moreover, the agreement does not intervene in Ukraine’s already established state-owned businesses such as Energoatom and Ukrnafta.
The deal also makes it clear that it will not hinder Ukraine’s effort to join the European Union. Accordingly, it is unlikely to provide any preferential treatment to U.S. investors, as doing so would affect Ukraine’s EU membership prospects.
What mineral resources does Ukraine possess?
The U.S.-Ukraine agreement is based on the assumption that Ukraine possesses rare natural resources worth trillions of dollars. However, this claim is not undisputed, scientifically proven fact. While there are varying opinions about Ukraine’s natural wealth, the most significant mapping of its mineral resources was conducted during the Soviet era. As a result, detailed information about critical mineral deposits in the region remains largely classified.
Geologists estimate that Ukraine’s mineral resources are concentrated in two geologic provinces. One is a wide belt extending through the centre of the country from northwest to southeast, known as the Ukrainian Shield; the other is located in the eastern region, near the Russian border, where most of the coal, oil, and natural gas reserves are found.
According to some reports, a significant portion of Ukraine’s natural resources—up to 40% of critical minerals—are located in the territories currently occupied by Russia. Some analysts argue that gaining control over Ukraine’s mineral wealth was one of Russia’s strategic objectives. Notably, Russia control Ukraine’s biggest lithium deposit in Shevchenko, Donetsk.
Setting aside contentious claims and the impact of Russian occupation, Ukraine’s subsoil is known to contain 117 types of minerals, including 22 classified as critical. Some studies suggest that Ukraine holds 5% of the world’s mineral resources, despite covering only 0.4% of the Earth’s surface. It has 8761 mineral deposits and 1288 recorded sites for 95 commercially valuable mineral types. Before the war, 3055 of these deposits were active.
According to World Economic Forum, Ukraine holds a significant deposit of titanium, lithium, beryllium, manganese, gallium, uranium, zirconium, graphite, apatite, fluorite, and nickel. With the largest titanium reserves in Europe, Ukraine is one of the few countries that mine titanium ores—crucial for aerospace, defence, automotive, maritime and medical industries. EU analysis identifies Ukraine as a potential source of over twenty critical minerals.
In addition to being among the top 10 producers of titanium, Ukraine ranks seventh in manganese and kaolin extraction, and 11th in zirconium silicate production. It has 19 million tonnes of proven graphite reserves, making it the fifth largest globally. Other critical minerals found in Ukraine include beryllium and uranium.
Why are critical minerals important to the U.S.?
Critical minerals are extremely important in the present economy, especially in sectors driven by computing technologies, renewable energy, and advanced defence systems. From electric vehicle batteries and solar panels to fighter jets and guided missiles, critical minerals such as lithium, cobalt, and rare earth elements are indispensable.
Presently, China holds a near-monopoly over the global supply chain of many of these critical minerals. This overwhelming dominance has raised serious concerns in the U.S. about supply chain vulnerabilities, economic dependency, and national security risks. Refining nearly 90% of the world’s rare earth elements, China possesses significant leverage over the West, especially the U.S.
Revealing this, China recently placed export restrictions on rare earth elements, as a response to the tariffs imposed by President Trump. This move underscored the West’s dependence on Chinese rare earths, especially in the U.S. defence sector, which is particularly exposed. Some reports suggest that the U.S. is currently unable to compensate for any shortfall caused by Chinese export controls. Recognising this vulnerability, the U.S. Department of Defence, since 2020, has been working to establish a domestic supply chain for rare earth minerals critical to the defence industry. It is expected to be operational by 2027.
This is not the first time China has used export controls as a geopolitical tool. In 2023, citing national security concerns, it restricted the export of gallium and germanium, key components in semiconductor manufacturing. A similar action was taken against Japan in 2010 over a territorial dispute.
As geopolitical tensions rise, particularly in the context of U.S.-China strategic competition, ensuring access to alternative and secure sources of critical minerals has become a top policy priority for Washington. Agreements like the one with Ukraine are part of a broader strategy to reduce dependence on China.
