Money in exchange for control: how a subsoil deal could change Ukraine’s future
27 March 2025 22:00
The United States is seeking to establish significant control over Ukraine’s infrastructure and mineral investments through a proposed partnership agreement, raising concerns about the country’s economic sovereignty and future prospects for European Union membership. This was reported by "Komersant Ukrainian" with reference to Bloomberg.
According to the news agency, the draft agreement grants the United States the “right of first refusal” to invest in Ukrainian infrastructure and natural resources, which effectively gives it a veto over other potential investors, including European partners.
The proposed agreement covers such critical sectors as:
- roads
- railways
- ports
- mines;
- energy production.
It also provides for the creation of a special investment fund for reconstruction, which will be managed by the United States.
According to the agreement, Ukraine will be obliged to contribute 50% of the profits from new projects to this fund, with Washington having the first right to receive the profits. Notably, the United States justifies this control as compensation for its significant military and economic support for Ukraine after Russia’s full-scale invasion in 2022.
Leverage and economic control of the United States
The agreement gives the United States exclusive rights to purchase Ukrainian metals, minerals, and other natural resources before other countries. In addition, Washington can prohibit Ukraine from selling its resources to countries considered “strategic competitors” of the United States. This level of influence would significantly limit Ukraine’s ability to diversify its economic partnerships.
Moreover, the US International Development Finance Corporation (DFC) would control the decision-making process of the Reconstruction Fund. The DFC would appoint three of the five board members and retain a “golden share” with a special veto power. Ukraine would be allowed to appoint the other two members, but would be largely excluded from participation in the fund’s activities. The agreement also stipulates that Ukraine cannot look for alternative investors for rejected projects for at least one year, further limiting its economic independence.
Impact on Ukraine’s European integration aspirations
Although Ukraine has made significant progress on its European integration path, gaining EU candidate status in 2022 and preparing for formal accession negotiations, the proposed US deal could jeopardize its ambitions for EU membership. European leaders fear that Washington’s dominance of Ukraine’s economy will reduce Kyiv’s ability to operate within the EU’s legal framework.
A key stumbling block in the negotiations is Ukraine’s insistence that any agreement with the US should not contradict its Association Agreement with the EU. The EU has previously emphasized the importance of a transparent investment policy aligned with European standards. By giving the US disproportionate control over Ukraine’s economy, the deal could undermine Ukraine’s ability to meet the requirements of EU membership.
Trump’s pressure and diplomatic tensions
The current progress of this agreement comes amid renewed diplomatic friction between the US and Ukraine. President Donald Trump reportedly put significant pressure on Ukrainian President Volodymyr Zelenskyy to agree to the terms. Tensions rose after a contentious meeting in the Oval Office, during which Trump expressed frustration with Ukraine’s reluctance to agree to US demands.
The Trump administration is also using the agreement as leverage to reach a peace deal with Russia. The United States is pushing Ukraine to make territorial concessions and reduce its dependence on Western military aid, while making limited demands on Russia. Critics argue that this approach effectively forces Ukraine to make unfavorable economic and political compromises.
See also: Ukraine may sign a deal with the US on subsoil next week: MP calls it a “nightmare” for Ukraine
Ukraine’s reaction and current negotiations
Despite the pressure, Ukraine remains cautious about signing the deal without significant amendments. Zelenskyy noted that his government will conduct a “detailed study” of the proposal and submit counterproposals to address key concerns. Ukrainian officials have emphasized that cooperation with the US is important, but not at the cost of compromising national interests or EU integration efforts.
In his speech from Paris during the European summit, Zelenskyy acknowledged the difficulty of the negotiations. While he reaffirmed Ukraine’s commitment to maintaining strong ties with the United States, he warned against any agreement that could undermine the country’s sovereignty.
“We support cooperation with the United States, but we will not accept conditions that weaken the future of Ukraine,” Zelenskyy said.
Potential economic impact
If implemented in its current form, the deal would give the United States unprecedented control over Ukraine’s post-war reconstruction and economic development. Ukraine’s dependence on U.S. funds to rebuild infrastructure and extract natural resources could significantly reduce its financial autonomy. In addition, restrictions on partnerships with other countries will stifle competition, which is likely to reduce Ukraine’s revenues.
Another controversial provision of the agreement is that it obliges Ukraine to return military and economic assistance provided to the United States in the past. Critics argue that it effectively burdens Ukraine with a “war debt” that will further drain its finances. Instead of allocating resources to rebuilding the country, a significant portion of Ukraine’s revenues will be diverted to cover U.S. contributions.
European opposition and alternative proposals
European leaders have opposed the deal, perceiving it as an attempt to sideline EU interests. Some EU countries have already made significant financial and military contributions to Ukraine and are concerned that the dominant role of the United States could undermine their influence.
There have been calls in the EU for a coordinated European investment plan that would provide Ukraine with reconstruction funding on more equitable and transparent terms. European officials argue that a balanced approach to rebuilding Ukraine would promote long-term stability and growth, rather than consolidating control in the hands of a single foreign power.
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