You can read the full report on AP here:
https://apnews.com/article/ukraine-us-rare-earth-minerals-deal-8566241ea0e121a30437d845357055d8
SAMYA KULLABis with the Associated Press and the information reports that a minerals deal between Ukraine and the United States has been signed, however, it is no where near what President Trump was demanding.
The ‘deal’ does not include resources that are already a source of revenue for the Ukrainian state, which means that the deal only applies to NEW found minerals, if any are found, you will see why I say this a bit later.
The most ridiculous part of this ‘deal’, in my view, is that profits from the fund will likely NOT go toward paying the U.S. back for its previous support, which Trump strongly demanded that Ukraine would have to pay back the U.S.A. $500 billion dollars as compensation for the wartime support that the U.S.A. provided, and apparently, this is no longer part of the deal.
Ukraine will retain full ownership of the resources, again, Trump wanted full control of the mineral resources, what happened?
Did Trump fold and cave?
Ukraine will determine what can be extracted and where, which is to say that Ukraine will be in full control and fully direct the U.S.A excavators the location of the dig and the quantity of minerals that the U.S.A. can dig up.
Deal does not mention any explicit security guarantees to deter future Russian aggression, which is a good part of the deal, as this does not commit U.S. Military forces to defend Ukraine, however, since the U.S.A. will be in Ukraine digging and excavating, if an attack ensues, the U.S. Military may have no choice but to join the war effort.
The ‘deal’ does list 55 minerals such as titanium, lithium and uranium. lanthanum, cerium and scandium which are elements that are essential to many consumer technology, including cellphones, hard drives and electric and hybrid vehicles and this is a great positive for U.S. technology companies.
This agreement establishes a ‘reconstruction investment fund’, this is not a military defense agreement, but this may change.
Both the U.S.A. and Ukraine will have equal management of the fund which may sound good but may create conflict on strategies and timelines.
The fund is to be supported by the U.S. government through the U.S. International Development Finance Corporation agency which may give the U.S.A. some leverage and control, but maybe not much.
Ukraine is to contribute 50% of all future profits from government-owned natural resources but this is not clear as to where the 50% will be contributed.
The United States will contribute direct funds and equipment, including air defense systems and other military aid which is a very large investment on the part of the U.S.A. and may cause Russian aggression if the U.S.A. funding is seen as supporting the war efforts on the part of Ukraine.
Contributions to be reinvested in projects related to mining, oil, gas, and infrastructure, this may refer to rebuilding Ukraine economic infrastructure.
The ‘deal’ also calls for no profits to be taken from the fund for the first 10 years, and Trump will be long gone by 2028.
Not only is this a ‘watered-down’ deal, it is a deal with a lot of unknowns.
For example, because Ukraine has strict state policies regulating the mineral industry, and due to the lack of good information on deposits, not to mention the ongoing war, the rare earth industry’s potential is unclear, to say the least, as geological data is thin and mineral reserves are scattered across Ukraine.
Existing studies are considered largely inadequate according to businessmen and analysts.
What does this mean?
In simple terms, Trump has bought a car without looking under the hood.
Though it is ‘predicted’ that the outlook for Ukrainian natural resources is promising based on 2021 data, where Ukrainian’s mineral industry accounted for 6.1% of the country’s gross domestic product and 30% of exports.
This is good information if you BELIEVE what is in the ‘reported outlook report’.
What is even more concerning is that it is estimated that 40% of Ukraine’s metallic mineral resources are inaccessible due to Russian occupation.
Ukraine has said in essence that Trump had better come after the minerals quickly before Russia advances further into Ukraine and captures more territory.
In my simple view, this message is to say that if Trump wants Ukraine minerals, there is a high probability that the U.S.A. will be dragged into the Ukraine/Russia War, and THIS is NOT a good deal for America.
We shall see.