Deal with USA includes 12 articles, list of minerals, Ukraine's PPP agency to represent country
The U.S.-Ukraine Reconstruction Investment Fund agreement signed in Washington on Wednesday contains 12 articles and a list of critical materials including oil and gas. It is financial in nature, and Ukraine will be represented in the fund by the Public-Private Partnership (PPP) Support Agency under the Ministry of Economy, according to Deputy Minister and Trade Representative of Ukraine Taras Kachka.
"This is a fairly concise agreement: just 12 articles, a preamble, and definitions. It lays the groundwork for the establishment of the fund – that's the core of it," said Kachka, who led Ukraine's delegation in technical negotiations to prepare the agreement, speaking via phone on a television marathon from Washington on Thursday morning.
He noted that the preamble clearly characterizes the relationship between the partners, including affirmations regarding the sovereignty over Ukraine's natural resources – that this sovereignty is upheld across the entire territory of Ukraine.
"This once again underscores the United States' faith in Ukraine's territorial integrity," Kachka stated.
According to him, the preamble explicitly states that Ukraine retains full sovereignty over its mineral resources.
"This entire agreement is financial in nature, which means that American partners will invest in companies that extract mineral resources in volumes and locations determined by the Ukrainian government, and they will receive financial returns based on investment profits generated by the fund," the deputy minister explained.
He outlined how the fund will function: both sides will contribute to it, and those contributions will be invested in Ukraine. Revenues generated from these investments will then be distributed between Ukraine and the United States.
"We expect contributions from the United States to include both monetary and military resources – new military assistance. Ukraine may also contribute funds, but in any case, 50% of future royalties from the extraction of critical materials, as clearly defined in the agreement, as well as oil and gas, will go into the fund," Kachka added.
He described the agreement as a new, creative, and unique legal instrument for the United States, which partially explains the complexity of its drafting. "Ultimately, the challenge was to find a legal formula, enshrined in the intergovernmental agreement, that would be interpreted equally by both parties – and indeed globally – and we succeeded," he emphasized.
Kachka noted that the idea for the agreement emerged only on February 12, and that since then, Ukrainian officials have worked with colleagues from the U.S. Department of the Treasury and the U.S. Development Finance Corporation (DFC) – the fund's future partner – to determine contribution models, investment policies, and other key parameters.
He stressed that the agreement explicitly states it requires ratification after signing.
"Obviously, we will begin consultations with parliament and present it with maximum transparency. This is extremely important to us, as the agreement is unique and has been surrounded by a number of manipulations in the media, various fearmongering and misunderstandings," he said.
Following ratification, the fund itself will be established between DFC and Ukraine's PPP Agency under the Ministry of Economy, with all necessary legal frameworks to be set up between the two entities.
"Then the work of making investments will begin," Kachka concluded.