Publications

War over resources: will mining become a driving force for peace in Ukraine?

The terms of the minerals agreement between Ukraine and the United States may be revised as U.S. President Donald Trump seeks a “better deal.”

CBS News reported this on March 5, citing its anonymous sources.

Although Ukraine has already expressed its readiness to sign the agreement, the US side says the deal is not yet finalized. US Treasury Secretary Scott Bessent, in response to journalists’ questions about the relevance of the agreement, said: “Not yet”.

CBS New’s sources also report that the terms of the deal may change as President Trump seeks to reach a “better and more favorable deal” for the United States.

In addition, Trump noted that he had received an important letter from Ukrainian President Volodymyr Zelenskyy, which stated that Ukraine was ready to return to negotiations, in particular, on the signing of the minerals agreement. Trump praised Zelenskyy’s proposals for the first steps to end the war.

In his speech to Congress, which was the first after his inauguration, the American leader emphasized that the letter was about a willingness to sit down at the negotiating table and sign an agreement on rare earth metals. Trump also noted that the letter stated: “No one wants peace more than the Ukrainians.”

What the signing of the agreement on minerals will actually mean for Ukraine, how it will affect the economy and Ukrainian citizens – Komersant ukrainskyi analyzed in detail.

Andriy Dligach, Doctor of Economics, explained in his talk that the development of cooperation between Ukraine and the United States is important, but it is not the only issue on the agenda. According to him, the key area is the development of cooperation, in particular in minerals and resource processing.

“I am convinced that cooperation will be developed, but I am convinced that this is not the key issue. The key issue is the development of cooperation on mining for the benefit of American further processing, or will it be the development of joint projects in the de-occupied territories to create value-added products in Ukraine? ” said Dligach, emphasizing the importance of resource processing in Ukraine.

He also drew attention to the fact that the agreement does not specify specific projects, although there is already an understanding that it is only about new projects.

“Ukraine’s priority for mining in the occupied territories remains. It is in the interests of the United States to help Ukraine de-occupy our lands, ” the expert explained.

Investments and conditions for business development

When asked about the participation of Ukrainians in mining, the expert emphasized that this implies the creation of new jobs. However, he also noted that in order to attract investment to Ukraine, it is important to create conditions for business where the rule of law prevails, not socialist logic. He emphasized that an entrepreneur will not invest if there is a risk of business expropriation in the country, which is an important factor for economic development.

“An entrepreneur will receive business capitalization, significantly more access to financial resources in order to scale and develop,” said Dligach.

This will also lead to an increase in salaries for Ukrainians, as the economy will be actively working in the country, and the demand for qualified personnel will grow. Another important aspect is the management of national wealth. Dligach noted that it is necessary to create conditions for the effective use of what is still in state ownership.

“This is the property of the people of Ukraine, and it is an important task to evaluate this property and put it at the service of the interests of the people of Ukraine, ” the expert emphasized.

He recalled the examples of other countries, such as Romania and Norway, which have created funds to manage national resources, where a large part is given to private companies for development.

Ukrainian minerals: opportunities and prospects

Dligach also touched upon the issue of mineral deposits in Ukraine, which are important for the European Union. Ukraine has significant reserves of critical materials, such as titanium, lithium, uranium, cobalt, and rare earth metals, which open up new opportunities for the country.

“According to our European partners, 21 out of 30 critical materials needed by the EU are located in Ukraine. This means that we have the potential to become a key player in the minerals market,“ , said Andriy Dligach.

Andriy Dligach also refuted the myths that arose in Ukrainian society after the news of the agreement with the United States. Many people fear that Ukrainians will work for the interests of another state, and even compare it to exploitation.

“Such thoughts arise because of our lack of education and economic literacy,” he explained.

According to him, working for foreign companies in Ukraine, Ukrainians receive good salaries, and this does not reduce their contribution to the development of the national economy. It is important to create conditions for Ukrainians to return and create added value for Ukraine.

“We have to create conditions for Ukrainians to return to the country and work for its development. This means attracting investment and developing large ambitious projects,“ says the expert.

The Subsoil Agreement is just a framework agreement without specifics

People’s Deputy of Ukraine Yuriy Kamelchuk exclusively for KU shared his thoughts on the minerals agreement between Ukraine and the United States. He drew attention to several important aspects of this document and explained why the preliminary stage of signing the agreement should not be overemphasized.

“It seems to me that the fact of signing the agreement has been given too much weight. At this point, nothing has been fixed yet,” he said.

According to the MP, the main thing discussed in the agreement is the creation of a working group to develop further agreements. According to Kamelchuk, these agreements do not require ratification by the Verkhovna Rada, as they do not contain specific details and leave open questions about specific areas and types of minerals.

Despite the lack of clear specifics, Kamelchuk sees the agreement as a positive signal for investors.

“This is a signal for investments from other countries and a signal that there can be long-term cooperation with the United States,” he explained.

He also noted that the agreement could be an important step in the development of cooperation with American partners, although it does not include specific security guarantees or specific investments. Kamelchuk emphasized that the agreement does not include any security guarantees for Ukraine. According to him, the issue of security should be regulated in separate agreements on military cooperation. This aspect, according to Kamelchuk, is also closely related to the future political and economic situation in Ukraine.

As for the upcoming signing of the agreement on joint mining, Kamelchuk believes that the agreement will be signed anyway, although he emphasizes that there is nothing new in this.

“This is an absolutely normal deal. There is nothing new if you look at the global practice. These are agreements that have existed for decades with Middle Eastern countries, such as Saudi Arabia or the Emirates,” he explained.

Minerals agreement: economic and political guarantees

In a conversation with KU journalists, military expert and analyst Dmytro Snegiryov revealed important aspects of the future agreement on rare earth metals and its impact on peacekeeping processes in Ukraine.

Answering the question whether the signing of the agreement on minerals can contribute to peace in Ukraine, Mr. Snegiryov noted that this issue concerns not only economic but also military and political guarantees from Ukraine’s strategic partners, in particular the United States.

“Yes, it does. We are talking about both economic and military-political guarantees from our strategic partners, first of all, the United States,” the expert said.

According to Snegiryov, the issue of peacekeeping operations in Ukraine depends on the reaction of the United States. The expert said that proposals from the UK and France, as well as Germany’s readiness to send its contingents, are awaiting the US reaction. Snegiryov emphasized that these proposals are futile without agreement with the United States. This is also confirmed by official statements by French President Emmanuel Macron, who recently said that the peacekeeping operation is currently “on hold.”

An important aspect is not only the economic benefits of the agreement on the joint use of Ukrainian subsoil, but also its geopolitical significance. Snegiryov notes that the signing of such an agreement is an important signal to the Russian Federation that Ukraine will remain in the orbit of Western military, political, and economic influence, especially that of the United States.

Mineral mining during the war: economic risks

Snegiryov also explained why mining in Ukraine during the war is a difficult task and why mining is impossible without the cessation of hostilities.

“No, it is not possible. It is theoretically possible, but it is a risk zone. And this is not only an economic issue, but also a political and military one,” he explained.

He emphasized that these issues cannot be considered separately, as they are closely intertwined. Economic prospects will depend on the resolution of the political and military situation in the country.

In general, Mr. Snegirev emphasized that the agreement on rare earth metals is part of a broader process that includes political, economic and military aspects. He noted that without resolving the political component, it is impossible to realize economic benefits, and this, in turn, will affect the military situation in Ukraine.

Thus, mining is an important component of Ukraine’s economic development, but its success depends not only on the efficient use of resources, but also on political decisions, including peacekeeping initiatives and partnership with the United States. The agreement on minerals is only the first step towards long-term cooperation, which will be of practical importance only after specific arrangements are reached in further agreements. Despite the fact that the signed agreement does not contain direct economic and security guarantees, it creates a framework for attracting investment and strengthening cooperation with international partners, including the United States.