The US-Ukraine minerals deal
The Trump administration and Ukraine have signed an agreement to jointly exploit Ukraine's mineral resources. This endeavour invites American companies to set up shop in Ukraine with a strategy customary for operating in poor developing countries: making a small initial investment and extracting as much future profit as possible, for transfer to the US, not for local reinvestment. But who is going to sink a single investment dollar in a war torn country risking to be totally destroyed and swallowed by a neighbor who couldn't care less about foreign investments (and who himself would like to sell the same minerals to the US)?
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Michael Bociurkiw reports:
The US and Ukraine have signed a deal that will give Washington access to some of the war-torn country's natural resources. Months in the making, it sets up an investment fund that Ukraine hopes will cement US assistance as the country struggles to repel Russia three years after the invasion. Trump has previously demanded that Ukraine pay back the $350bn (£264bn) of aid that he claims has been provided by the US during the war - a condition that Zelensky rejected. But Washington appears to have made a concession. Ukrainian Prime Minister Denys Shmyhal said the agreement did not dictate that his country pay back any supposed "debt". The language used by the US in announcing the deal is notably harsher towards Russia than is usually the case from the Trump administration. The agreement refers to "Russia's full-scale invasion.” One intriguing point highlighted by Ukraine's government is that for the first decade of the reconstruction investment fund, profits will be "fully reinvested in Ukraine's economy", either in new projects or reconstruction. This could be potentially significant if there is no financial benefit for the US for 10 years - BBC
CNN Chief International Security Correspondent Nick Payton-Walsh described the deal as largely symbolic. “Trump needed to feel America was getting something back from Kyiv. Ukraine needed to show its relationship with this White House was functional and improving. Ukraine’s allies needed this done and dusted to remove a distraction from the complex talk of military aid and real peace that must now become their focus. The deal’s text also contains two phrases that will be distinctly pleasing to Kyiv. First, it refers to the “large-scale destruction caused by Russia’s full-scale invasion of Ukraine” – an unambiguous statement of blame from a White House that has often preferred to pull its punches. And then it explains how Ukraine might buy arms from the US – vital given the escalating Russian onslaught across the front lines.”
Deputy Chief of Staff Stephen Miller reminded reporters Thursday that the mineral resource deal signed with Ukraine is “payback” for US support of Kyiv
Michael Bociurkiw --My comment: Even before the ink was dry, the Trump camp began walking back key concessions in the U.S.-Ukraine resources deal—chief among them, the claim that it wasn’t a quid pro quo for the $350 billion Washington says it has provided to Kyiv since the start of Russia’s full-scale invasion. In reality, the figure is closer to $185 billion. At today’s White House press briefing, Deputy Chief of Staff Stephen Miller (see video) undermined the spirit of the deal—and offended many Ukrainians—by calling it “payback” for “the hundreds of billions our taxpayers have spent subsidizing the war in Ukraine.” As I told several broadcasters, watching this unfold as a Canadian raises deep skepticism about the Trump administration’s intentions. This is an administration that has spent much of its first 100 days dismantling long-standing U.S.-Canada agreements. And having spent much of the past three years in Ukraine, I can say with confidence: few Ukrainians want foreign powers interfering with their natural resources. There is widespread fear that a poorly negotiated deal could reduce Ukraine to an economic colony of the United States. Critics of the Zelensky administration argue that rare earth minerals should never have been on the table in discussions with Washington. But once the Trump administration caught wind of an economic opportunity, it pounced. A final note on timing: China’s recent ban on rare earth mineral exports likely sent a chill through the Trump administration. These elements are essential to nearly 2,000 components used by the U.S. military (heavy rare earths are used in many military fields such as missiles, radar, and permanent magnets, BBC reported. A CSIS report notes that defence technologies including F-35 jets, Tomahawk missiles and Predator unmanned aerial vehicles all depend on these minerals). Ukraine suddenly appeared as a potential alternative—though production is years away—and as a source the administration might more easily pressure and control.
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