Donald Trump’s latest scheme to exploit Ukraine is gaining momentum. Kyiv has been handed a rewritten, 58-page minerals deal, which obliges Ukraine to repay every cent of US military and humanitarian aid it has received since Russia’s 2022 invasion. Washington is also demanding control over half of Ukraine’s income from its natural resources, including oil and gas. The deal is indefinite: Ukraine cannot break or amend it without US approval. What does Ukraine get in return? Absolutely nothing.
Trump is pushing for the deal to be signed next week, but even if Volodymyr Zelensky is forced to agree to the terms, it would be very unlikely to be ratified by Ukraine’s parliament. The current draft would leave Ukraine owing the US at least $120 billion. It would set a dangerous precedent, too, opening Ukraine up to the possibility of other countries demanding repayments for aid.
Under the deal, the Ukrainian government would be obliged to convert half of its income from its minerals, gas, oil and even railway infrastructure into US dollars and transfer them abroad. Any delay would result in financial penalties. The US would install a supervisory board to control this so-called ‘joint investment fund’, with past US aid being its only contribution.
The proposed supervisory board would consist of five members: three Americans and two Ukrainians, and any decision would have to be approved by a majority. Washington would have full veto power and could choose whether or not to reinvest the profits into Ukraine at its own discretion. The US would also receive annual royalties at a 4 per cent premium before Ukraine gets anything.
Washington would also gain first-refusal rights for all future investments in Ukraine’s natural resources and infrastructure. Only if US investors decline a proposal could Ukraine offer the deal to others. However, even then, Kyiv would be forced to share confidential details of their negotiations with US officials. Ukraine would be legally banned from offering better terms to other investors for a year after America has passed on a project.
Companies extracting Ukraine’s critical minerals would be barred from selling to buyers Washington deems ‘strategic competitors’. Given Trump’s trade war with Europe, there’s a strong chance the EU could fall into that bracket. It would close the door to Ukraine’s future EU membership that Ukrainians so keenly aspire to.
The bad news doesn’t end there. Zelensky can’t say no, for fear of risking another fight with Trump. Ukraine is still reeling from the pair’s fallout in the Oval Office and desperately needs the US on side for negotiations with Russia. The only option Kyiv has is to stall the agreement. Zelensky’s team is preparing a counteroffer – one that doesn’t undermine Ukraine’s sovereignty. Trump had previously softened some of the most exploitative terms in the first draft of the minerals deal a month ago. Ukrainians are hoping that he will do so again – or that Trump scraps the deal himself.
This article originally appeared in Svitlana’s weekly Ukraine in Focus newsletter. Sign up here.
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