Ukraine rejects initial Trump request for half its mineral wealth
Ukraine is hoping to reach a deal on a counteroffer, but the opening proposal rippled through European diplomatic circles not only for its audacity but because the war-ravaged country appears ready to play ball.
Zelensky told reporters Saturday that he had not agreed to the Trump administration’s proposal “because it’s not ready yet.” He said that security guarantees were not part of the U.S. proposal, and that Ukraine needed that in any agreement with the United States.
“We can consider how to distribute profits when security guarantees are clear. So far, I have not seen that in the document,” he told reporters at an annual gathering of U.S. and European security elite.
The request came when Treasury Secretary Scott Bessent visited Kyiv on Wednesday, becoming the first Trump Cabinet official to meet the Ukrainian leader, according to three senior Ukrainian officials, two European diplomats and two more people familiar with the situation. They and others spoke on the condition of anonymity to talk frankly about the sensitive issue.
The offer and Ukraine’s consideration of it rippled through European diplomatic circles not only for its audacity but also because the war-ravaged country appeared to be seriously considering how to reach a deal in the hope of a commitment from the United States to help defend against Russia’s aggression.
One senior Ukrainian official joked that the country’s leaders would consider nearly anything to maintain U.S. support, including, the official said, a massive shipment of Ukrainian eggs. The country has an egg surplus, and leaders there are aware of their skyrocketing cost in the United States.
But another senior Ukrainian adviser described being taken aback by the scale of what the Trump administration demanded. The person compared it to Europeans carving up African colonies in the 18th century, and said it could also lead to the right to develop Ukraine’s resources being signed away for decades with no guarantees that investors would actually develop them.
The White House did not immediately respond to a request for comment.
Trump said earlier this past week that the U.S. was interested in securing access to Ukraine’s “rare earth” minerals. That comment set off some confusion both in the U.S. and in Kyiv, because, although that category of elements does exist in Ukraine, the country does not contain them in noteworthy quantities. “Rare earths” is the official category for a group of 17 elements used as magnets to power electric vehicles, cellphones and high-tech defense systems.
One Ukrainian adviser briefed on the matter said the U.S. was actually pushing for control over a wider range of materials, including rare metals and critical materials such as lithium, graphite and uranium, which can be sometimes confused with “rare earths.”
While Ukraine is not a dominant global producer of these materials either, their long-term value could spike as demand soars globally over the next decade or more. The adviser, citing internal estimates, suggested the total value of the country’s rare materials could reach as high as $5 trillion, although that number is highly uncertain. The exact list of Ukrainian resources that Trump wants control over is not known.
“Ukraine needs international cooperation in mining resources because this can make future peace just and long-lasting, and the deal should be profitable for all sides, not looking like a reparation,” said Volodymyr Landa, senior economist at the Center for Economic Strategy, a Kyiv-based think tank.
One of the senior Ukrainian officials said that Kyiv received the proposed U.S. mineral deal just four hours before Bessent met with Zelensky in Kyiv on Wednesday. In that meeting, the treasury secretary “insisted” that Zelensky sign it immediately. Zelensky did not, the official said.
The Ukrainians continued to discuss the proposal on Friday, when Zelensky met with Vice President JD Vance and Secretary of State Marco Rubio in Munich. Ukraine has told the Trump administration that it cannot legally sign away its mineral resources in the way proposed by Washington, but Ukrainians have continued to mull alternatives, two Ukrainian officials said.
The Friday meeting was delayed for several hours when Rubio’s plane experienced mechanical difficulties and had to turn around — buying the Ukrainians valuable time to come up with a counterproposal, one of the officials said.
Zelensky had only a few minutes to read the U.S. proposal before his Wednesday meeting with Bessent, said one person familiar with the discussions.
“Ukraine has theoretically agreed” to the concept of such a deal, but disagreed with the lack of U.S. security guarantees listed in the proposal, the person said. The document Zelensky declined to sign this week was more of a short memorandum of understanding “governed by New York law” than a major international agreement, the person said, adding that it would not have been enforceable. Ukraine would expect any such deal to last for decades to come and wants such an arrangement to be ratified by its parliament.
The idea appears at least partially inspired by Ukraine, which identified investments in its natural resources as a way to help develop its economy and pay for the war effort. Zelensky first suggested providing the United States with the materials during a meeting with Trump in September, prior to the election. The idea is also part of a “victory plan” Zelensky made public the following month.
But Zelensky has said he wants European involvement and investment in developing his country’s resources, not just Washington’s.
Zelensky confessed Saturday to feeling stressed about the Trump administration’s approach to his country.
Asked after delivering a speech at a public forum in Munich whether he felt Trump and Vance understand the stakes of Ukraine’s fight against Russia, Zelensky said: “I’ll be honest. We have to work on it. All of us, not only me.”
The audience of ministers and diplomats erupted in shocked laughter at his frankness, since leaders in his position typically seek to smooth away disagreements.
Europeans have been infuriated by the Trump administration’s plan to handle talks with Putin, since they haven’t been offered a seat at the table even though they will likely be asked to contribute the bulk of any military deployments that would help secure a peace.
Pressed repeatedly by prime ministers and top diplomats at a Saturday event to make sure that Europeans have a place at the table, Trump’s Ukraine envoy Keith Kellogg declined to offer them a seat.
“This is about borders in Europe,” Icelandic Prime Minister Katrin Jakobsdottir told Kellogg at a public lunch.
A previous effort to achieve peace in Ukraine during the Obama administration that was led by France and Germany led to failure, Kellogg said.
“They failed miserably. So we’re not going to go down that path,” he said, while saying that he remained eager to hear Europe’s input.
Trump allies have expanded and seized on the minerals idea as a way to maintain the president’s support for Kyiv.
“Ukraine has value. Literally has value,” Sen. Lindsey Graham (R-South Carolina) said Saturday in Munich at an event sponsored by Politico.
“Trump now sees Ukraine differently,” he said. “These people are sitting on literally a gold mine … I showed him a map.”
If the United States is granted Ukraine’s mineral wealth, Graham said, “we will have something to defend. We will have an economic interest in Ukraine we’ve never had. And that’s a nightmare for Putin.”
Critics say that asking for 50 percent of the sector doesn’t match the level of assistance Kyiv has received. Ukraine has received about $66 billion in military aid from Washington since Russia’s full-scale invasion three years ago, according to the State Department, and about $50 billion in non-military aid, according to an estimate from the Kiel Institute for the World Economy. Ukraine received about $69 billion in military aid in the eight-year-stretch between Russia’s 2014 annexation of Crimea and the full-scale invasion.
“Investment now in the Ukrainian critical minerals sector could make a lot of sense. But President Trump’s initial offer seems unreasonable, exploitative and unlikely to help end the war. This is not a good way to promote American interests.” said Simon Johnson, an economist at MIT who has been involved in helping Ukraine with its economic planning.
“I expect the Ukrainian reaction to be dismay and disbelief,” he said.
O’Grady reported from Kyiv and Stein reported from Washington.
Posts
No comments:
Post a Comment