- A draft contract delivered to Ukrainian President Volodymyr Zelensky reportedly entitles the U.S. to half of his country’s mineral wealth. Whether or not such a deal would prove historically onerous, it would likely not help America meaningfully untangle China’s chokehold on supply.
President Donald Trump wants Ukraine to pay up for past American military support, and other reported details are emerging about a deal that would entitle the U.S. to half of its ally’s rare earth minerals. The contract draft, delivered by Treasury Secretary Scott Bessent to Ukrainian President Volodymyr Zelensky last week, covered the entire “economic value associated with resources of Ukraine,” the Telegraph reported Monday, including minerals, oil and gas, and even the country’s ports.
As Ukraine continues to defend itself against Russia’s invasion, Trump recently said he wanted “the equivalent of, like, $500 billion worth of rare earths,” referring to lithium, cobalt, titanium, and other minerals that are indispensable to modern technology ranging from guided missiles to electric vehicles. China has established a chokehold on the supply of rare earths over the past four decades. As the West races to catch up, the total value of Ukraine’s deposits has been pegged as high as $11.5 trillion.
Zelensky didn’t take long to reject Trump’s first proposal, however. The Ukrainian president initially floated the idea of giving mining rights to U.S. companies while talking to Trump last year, but he wants future American and European security guarantees tied to any deal with mineral reserves, the Financial Times reported.
Trump’s proposed contract has drawn comparisons to the reparations imposed by the Allies on a defeated Germany in the Treaty of Versailles following World War I. Germany accepted liability for roughly $32 billion, or about $560 billion today. Most historians cite German resentment of the treaty and the country’s resulting economic malaise as a significant cause of the rise of the Nazi Party and the outbreak of World War II.
Not only would Trump’s proposed deal be extremely onerous, it also doesn’t appear to make much sense, Marko Papic, senior vice president and chief strategist at BCA Research, told Fortune.
“Much of Ukraine’s rare earth deposits are in Russian occupied territories,” Papic said in an email. “Besides, [the] U.S. does not need rare earth deposits, it needs them refined somewhere other than China. Ultimately, the entire project seems a bit like something out of Civilization IV, the computer game.”
The White House had not responded to a request for comment at the time of publication.
Trump’s Ukraine rare earths deal faces roadblocks
It’s no surprise Ukraine’s potential subsoil riches have piqued the interest of Trump, who has long said he wants to buy mineral-rich Greenland. Ukraine has deposits of 117 of the world’s 120 most-used industrial minerals, according to MiningWorld. Government estimates suggest the country is home to 10% of the world’s lithium reserves.
None of that has been mined so far, however. Much of Ukraine’s mineral wealth remains untapped, and estimates about the country’s deposits are based on Soviet-era surveys.
“The data is not modern; we have very little information about what’s there,” Gracelin Baskaran, a director at the Center for Strategic and International Studies, told the Financial Times.
That issue aside, Ukraine says more than 20% of its mineral wealth sits under territory currently controlled by Russia. Meanwhile, whatever the dollar value of Ukraine’s rare earths, developing the infrastructure to extract and process these minerals won’t happen overnight.
That reality underlines China’s massive lead over the West, which is less about access to the critical minerals themselves and much more about decades of investment and subsidies for mining and processing rare earths. As Foreign Policy explained last year, experts say the U.S. has a long road ahead to matching China’s economies of scale and advantage in expertise.
Pressuring Ukraine to give up half of its natural resources might not solve that.
