The U.S.-Ukraine Reconstruction Investment Fund: A Six-Month Progress Assessment

On September 7, 2025, Russia unleashed what was then the largest salvo of aerial attacks against Ukraine since the start of the full-scale invasion in 2022, firing a total of 810 drones and thirteen missiles in a single day. Some of the missiles hit the seat of Ukraine’s government, the Council of Ministers in central Kyiv. The same week of the Russian attack, an American delegation was in Kyiv to meet with Prime Minister Yulia Svyrydenko’s team to advance implementation of the U.S.-Ukraine Reconstruction Investment Fund (USURIF), which had been signed in late April following high-profile negotiations. This coincidental timing highlights the tension between Ukraine’s immediate needs for air defense systems and other weapons to defend against Russian attacks and its desire to attract private sector investment for long-term economic development.

Established six months ago, the USURIF was originally conceived as part of Ukrainian President Volodymyr Zelensky’s “Victory Plan,” which sought to synthesize Ukraine’s dueling imperatives of security and long-term economic viability. While Ukraine’s initial goal of parlaying U.S. President Donald Trump’s interest in critical minerals to gain broad security guarantees did not come to fruition, the fund is taking shape as an institutional partnership that can potentially attract additional capital into Ukraine’s natural resources sector. Ideally, the fund will complement Ukraine’s integration into Western critical minerals supply chains and will also acquire more flexibility to invest in other sectors that can address Ukraine’s immediate needs, not least the defense industry. As Svyrydenko said the day of the attack on her office building, “most importantly, Ukraine needs weapons.”

Foreign Policy by Balance Sheet

The USURIF is one element of a seismic shift in American policy toward Ukraine under Trump. Upon taking office, Trump voiced optimism that he could leverage his relationship with the Russian and Ukrainian presidents to quickly de-escalate the conflict and even produce a comprehensive settlement. On the economic side, the new approach has prioritized transactional, mercantile goals while de-emphasizing shared democratic values and European security as factors motivating America’s relationship with Ukraine. This change was not unique to Ukraine; during his first weeks in office, Trump frequently evaluated bilateral relations through the lens of monetary gains and losses. For example, the trade balance in manufactured goods was reportedly the key variable Trump used to determine the so-called liberation day tariff rates.

In the case of Ukraine, instead of balance of trade, Trump zeroed in on assistance the United States has provided to Kyiv since early 2022 as an indicator of the benefits Washington has or has not derived from the relationship. At various times, Trump asserted that the United States had provided $300 billion in assistance to Ukraine, while data from the Kiel Institute indicate the figure was approximately $134 billion as of June 2025. The USURIF’s focus on Ukraine’s mineral wealth was seen by Trump as essential to redress what he regarded as an unbalanced relationship. Trump explicitly stated that the balance sheet was a higher priority for him than the previous long-standing U.S. policy of supporting Ukraine’s efforts to resist Russian domination. He said, Ukraine “may make a [peace] deal [with Russia]. They may not make a deal. They may be Russian someday, or they may not be Russian someday. But I want this money back.”

The USURIF also exemplifies a second feature of Trump’s foreign policy, which is to reorient American development assistance away from aid programs and toward promoting trade and investment. In a Substack post marking the closure of the U.S. Agency for International Development (USAID), titled “Making Foreign Aid Great Again,” Secretary of State Marco Rubio declared that “charity-based” assistance had failed and the administration would prioritize “trade over aid, opportunity over dependency, and investment over assistance.” The administration has enhanced the role of the Development Finance Corporation (DFC) as a way to focus U.S. engagement on encouraging private sector investment overseas under the theory that this investment will power economic development and provide opportunities for American companies while reducing the burden on the U.S. budget.¹ The DFC was established in 2018 as a federal agency to mobilize private capital in developing countries to advance American foreign policy interests through investments in areas such as infrastructure, technology, healthcare, and climate using financing instruments including loans, political risk insurance, and equity investments. One key objective of the DFC has been to provide the United States with an additional tool in pursuing strategic competition with China.

The USURIF is the first tangible example of this model, which is likely to be replicated with other countries. The DFC is tasked with the lead role in establishing, financing, and managing the new entity. Given the DFC’s limited internal resources (about 525 staff covering the entire world), co-investing with Ukraine in the USURIF will enable the United States to increase the deal flow and shorten the timelines for finance projects. 

While empowering the USURIF to channel and attract more resources and attention to private sector–driven development could prove helpful for Ukraine’s reconstruction and growth, the country’s current war-related challenges also require other foreign assistance tools to save lives and provide services to the population. As one example, from the beginning of the war through January 2025, USAID and the Department of State had implemented a program to help Ukraine’s energy sector, which has been systematically targeted by Russian bombing campaigns. The United States supported repairing and rehabilitating Ukraine’s energy infrastructure by providing equipment, materials, and technical assistance to address the continued provision of basic services to Ukrainian citizens—including electricity, heat, and water—and strengthen the resilience of the grid. However, the United States no longer supports these programs. 

From “Minerals Deal” to Investment Partnership

The USURIF had its origins in the “Victory Plan” presented by Zelensky in October 2024. The plan was drafted in anticipation that the American approach to Ukraine would become more transactional following the U.S. election. Accordingly, it proposed expansive cooperation with Western partners on developing strategic sectors of Ukraine’s economy, including critical minerals such as titanium and lithium. In exchange, the United States and Western partners would provide Ukraine with stronger security guarantees and NATO membership. By gaining buy-in for the security commitments, Zelensky believed Ukraine would have more leverage vis-a-vis Russia and that his citizens would be more amenable to compromises. That autumn, Zelensky presented the plan to then U.S. president Joe Biden and other world leaders. He also discussed it with then candidate Trump, who in subsequent months reportedly grew increasingly interested in Ukraine’s critical minerals, as Americans with ties to Trump—including Senator Lindsey Graham and businessman Ronald Lauder—played up Ukraine’s resource potential.

During his first weeks in office, Trump spoke frequently about Ukraine’s resource riches and prioritized a minerals deal.

During his first weeks in office, Trump spoke frequently about Ukraine’s resource riches and prioritized a minerals deal, dispatching Treasury Secretary Scott Bessent to Kyiv in mid-February to conclude an agreement. According to media reports, the terms proposed by the United States were lopsided, granting 50 percent of Ukraine’s mineral resources to the United States, which would have had wide latitude to dictate the terms of future licenses and production sharing agreements. While the full text of the original draft agreement has not been officially released, analysts likened the terms to the reparations imposed on Germany after World War I rather than an equitable agreement to rebuild a nation that had been the victim of aggression. According to a leaked version of part of the agreement, the United States also wanted prior assistance provided to Ukraine between 2022 and 2025 to be treated like a contribution to the fund. 

For Ukrainian officials, the main attraction of a deal was to obtain security guarantees from the United States that would put Ukraine in a stronger position to negotiate an end to the war. Zelensky was willing to make significant concessions to the United States on economic issues to reach that objective. While the breadth and depth of security and intelligence cooperation between the United States and Ukraine expanded exponentially following Russia’s full-scale invasion in 2022, Ukraine was seeking stronger commitments from the United States about its future security given Ukrainians’ concern that a ceasefire could allow Russia to rearm and attack Ukraine again. In a series of bilateral security agreements completed with Ukraine in 2024, the United States, the United Kingdom, and two dozen other partners pledged to support Ukraine’s future accession to NATO and maintain assistance to its military. But without firmer, Article 5–style obligations to help defend Ukraine in the event of a future attack, Ukrainian officials did not feel they had sufficient leverage to negotiate with Russia or confidence that the country’s future in Western institutions was secure enough to persuade their citizens to accept compromises in the talks with Moscow. Because the Trump administration was open to new, unorthodox ideas, there was hope in Kyiv that, as part of an agreement on critical minerals, the United States would be willing to take bigger steps on the security side.

Still, Trump was opposed to Zelensky’s security guarantee proposal at the time and did not want it included in the minerals deal. The friction over U.S. security commitments to Ukraine contributed to a contentious meeting between the leaders on February 28 in the Oval Office. The meeting temporarily derailed negotiations and caused the United States to briefly suspend the flow of previously obligated security assistance to Ukraine. In the aftermath, both sides regrouped and charted a path forward. The United States revised many of its onerous demands for control of Ukraine’s resources and future income flows. Ukraine, meanwhile, accepted that the United States was not prepared to provide additional security commitments, instead reconceptualizing the agreement as a mechanism to keep the United States engaged with Ukraine for the long term. The Ukrainian side succeeded in removing provisions that classified previous assistance to Ukraine as debt and transformed the fund’s governance structure into a more equal partnership, in contrast to the original proposal that gave American officials control of key decisions.²

Treasury Secretary Bessent and then deputy prime minister Svyrydenko signed the USURIF on April 30. The agreement facilitates the creation of a partnership company supervised by six board members (three from each country) that will invest in Ukraine’s natural resources sector and associated infrastructure projects. The DFC will represent the U.S. side, while the State Organization Agency on Support Public-Private Partnership will manage the Ukrainian side. To capitalize the fund, Ukraine has agreed to contribute 50 percent of revenue from future natural resource licenses and production sharing agreements. In addition, the new partnership company will have a right to participate as an investor or offtake customer in any new project developed in Ukraine in the natural resources sector. The agreement lists fifty-five minerals that broadly overlap with the commodities classified as critical minerals by the U.S. Department of Energy, plus other elements, such as gold, tin, zinc, and arsenic, which are not typically defined as critical. The fund is also authorized to invest in oil and gas projects, which can typically be developed more quickly than large mines.

Most critically, for supporters of continued military assistance for Ukraine, the USURIF defines U.S. security assistance to Ukraine as a capital contribution to the balance sheet of the fund, which is to say that future U.S. military support for Ukraine can be considered an investment into future economically profitable projects rather than as charity, as it has been characterized by critics of aid to Ukraine.³ Within the U.S. government, supporters of a more activist Ukraine policy view the USURIF as a significant milestone since it strengthens arguments within the administration in favor of assisting Ukraine’s war effort. Ukrainians may regard this provision and the prospect of DFC-backed American investment as an implicit security guarantee; at a minimum, it is preferable to having the United States disengaging entirely from Ukraine. At its September meeting, the USURIF board discussed the formula to determine how such assistance will be credited to the fund, but no agreement was disclosed. However, the Trump administration has so far been disinclined to provide military support to Ukraine, preferring to establish mechanisms for European countries to purchase American equipment on behalf of Ukraine. This issue may resurface in the coming months, as the pipeline of weapons authorized for transfer to Ukraine by Congress in 2024 becomes depleted and American policymakers consider options for continuing to assist Kyiv.

One key issue Ukrainian representatives addressed during the negotiations is how the agreement will function alongside Kyiv’s ongoing accession process with the European Union.

One key issue Ukrainian representatives addressed during the negotiations is how the agreement will function alongside Kyiv’s ongoing accession process with the European Union. Ukraine objected to the initial version of the agreement in part because it did not reference Ukraine’s European integration. The final text acknowledges Ukraine’s need to avoid conflicts between the USURIF and Ukraine’s EU accession obligations. However, some commentators believe there are still potential problems. By granting U.S. investors a right of first refusal for certain projects, the agreement could contradict obligations Kyiv needs to make as part of Ukraine’s EU accession since EU legal doctrine requires that market access and competition rules remain neutral and nondiscriminatory.

A potentially positive element of the agreement from the Ukrainian perspective is that it establishes a precedent that “states and other persons that have acted adversely to Ukraine during the conflict do not benefit from the reconstruction of Ukraine following a lasting peace.” While Russian interests will clearly not be welcome to participate in Ukraine’s reconstruction, this language—depending on how it is interpreted—could affect businesses from a range of countries, such as China, India, the Gulf states, and many in the Global South that have not joined sanctions against Russia or have facilitated trade in products embargoed under export controls.

Implementation and Prospects

Since signing the framework agreement in late April, both sides have been pushing hard to get the fund up and running. This has involved efforts to organize the fund’s legal, managerial, and financial foundations. In the days after the intergovernmental agreement was concluded, Ukraine’s parliament ratified the agreement and approved necessary modifications to Ukraine’s tax, budget, and regulatory systems.⁴ In subsequent weeks, the DFC began the process of identifying organizations to manage the fund; this will most likely be a private investment company with experience in key functions, such as financial accounting and compliance with know-your-customer and anti–money laundering laws and regulations. The fund will also seek an investment management team to handle due diligence and negotiating investments. On finances, the governments agreed to commit $150 million in seed capital ($75 million from the DFC and an equal amount from the Ukrainian side) to jump-start the fund’s operations. Both sides also signaled their continued commitment to the project by appointing leading members of their economic teams—Bessent from the U.S. side and Economy Minister Oleksii Sobolev from the Ukrainian side—to serve on the fund’s board of directors.

The United States and Ukraine have also sought to dispel potential concerns that the fund would exclude others from opportunities in Ukraine. During a panel discussion at the Rome conference on Ukraine’s reconstruction in June, representatives from the DFC and Ukraine stressed that the goal is to work closely and co-invest with other multilateral development banks as well as with private investors. The goal, they stated, is to “crowd in” other investment and not “crowd out” potential partners in the selected projects.

A Ukrainian member of the fund’s board and deputy minister at the Ministry of Economy, Environment and Agriculture, Yegor Perelygin, confirmed that the fund considers itself as a market-making instrument to create industry-shaping developmental dynamics and bring in other investors, including big institutions with experience in the mining sector or in natural resources overall. He predicted that the fund will prefer to take minority stakes in given projects, and its added value will be providing political risk insurance, offtake mechanisms, and other guarantees to de-risk the investments. Overall, Perelygin sees the fund as an ideal opportunity to de-risk Western supply chains.⁵ Conor Coleman, the head of investments at the DFC, also stressed that the fund aims to catalyze private sector investment into promising enterprises in Ukraine. These statements indicate that, contrary to initial concerns that the fund would either compromise Ukraine’s sovereignty or exclude non-American investors, the USURIF will function largely as a conventional development finance institution, albeit with a narrow set of investment targets and unique mechanisms and rules governing how the shareholding countries will contribute to the fund.

Investments

The USURIF faces formidable challenges as a fund focused on natural resources in a single jurisdiction, particularly one that is fighting a war on its own territory. Many of the mineral resources are in central and eastern Ukraine, often close to areas of active fighting. The initiative is unlikely to contribute significantly to Ukraine’s near-term economic development, as mining typically lags behind other sectors’ growth in post-conflict countries. Industries such as transport, manufacturing, and construction often contribute more quickly to economic revival following a war, according to a World Trade Organization (WTO) study. Mining, even in stable countries, has intrinsically long timelines. Globally, the average time to develop a mining project from discovery to production is over fifteen years; even once a project is fully permitted and financed, it takes on average 2.3 years to construct a mine and begin production. The choice of critical minerals as the target for the USURIF seems to have been driven by the perception that Ukraine’s resources could align with U.S. needs rather than by an assessment of how the sector would contribute to Ukraine’s postwar reconstruction or assist in securing peace and stability. 

The USURIF faces formidable challenges as a fund focused on natural resources in a single jurisdiction, particularly one that is fighting a war on its own territory.

Despite these challenges, the DFC and its Ukrainian partners are showing a strong commitment to get the fund investing quickly. Sobolev has said his government’s goal is to invest in at least three high-quality projects in the next eighteen months, and a team from the DFC and the Ukrainian side has already started screening project ideas. Analysts believe that in the near term Ukraine has the potential to expand or develop the mining and processing of titanium, lithium, graphite, manganese, and uranium. In parallel, Ukraine may be able to utilize advanced technology to reprocess tailings from existing or decommissioned mines to extract critical minerals elements, such as germanium and gallium. Finally, the fund could spur investment in the oil and gas sector, which has been a perennial challenge for would-be Western partners.

Originally, the fund was going to focus on new projects, but the target set is evolving to include projects already under license. Presumably, the USURIF could provide financing to operational or in-development projects in exchange for offtake rights as a typical investor or traditional development finance institution would. In addition, Ukraine has granted dozens of licenses for mining projects that have not been developed; the government can explore whether it is possible to rescind the licenses and auction them again. The Ukrainian government will need to proceed carefully and in accordance with the law to ensure Ukraine develops a reputation as a stable jurisdiction in which to make mining investments.

Ukraine has the largest deposits of lithium in Europe, and the most talked about greenfield site is the Dobra lithium project, located about 100 miles south of Kyiv in the Cherkasy region. The Ukrainian government announced a tender for the deposit on September 12, and TechMet, a U.S. company that has a long-standing relationship with the DFC on critical minerals projects in Brazil and elsewhere, has said it will compete for the development rights. An Australian company already claims to own the license to exploit Dobra, so it will likely take some time to resolve legal issues before an investment is possible.

At least one existing enterprise is interested in cooperating with the USURIF to attract additional investment. In September, a DFC team visited Velta, an innovative Ukrainian titanium mining and processing firm that currently produces approximately 2 percent of global supply and has ambitious plans for expansion using its proprietary processing technology. Velta also has a track record of working with the U.S. government, including an ongoing negotiation for a $60 million loan from the Export-Import Bank for building a titanium manufacturing facility in the United States, as well as with European partners, with which it is conducting research under an EU project focused on developing resilient supply chains.

Maximizing the Fund’s Potential

Even though many commentators continue to refer to the USURIF as a critical minerals deal, representatives from both countries show signs that they understand the need for the fund to expand beyond this sector. The United States has an interest in doing so to demonstrate some early successes; Ukraine, for its part, would like to harness the fund’s capabilities to help economic sectors with a direct connection to the war effort while also contributing to the goal of integrating Ukraine into the West’s critical minerals supply chains. Given these interests, the USURIF should consider the following recommendations:

• Widen the aperture. The viability of mining projects often depends on the availability of energy and transportation. Prior to the full-scale invasion, Ukraine’s energy sector was in the midst of major transitions to make the system more market-oriented, decentralized, and aligned with EU regulatory and competition standards. Some of those processes have continued during the war, even as government and private sector actors scramble to keep the system running amid relentless attacks from Russia. Recognizing the criticality of energy to the mining sector—and to the rest of Ukraine’s economy—the USURIF should prioritize the energy sector as a whole in its early investments, not only projects with a direct nexus to mining projects. Following the initial board meeting, Coleman, the DFC representative, sent a positive signal by noting that one of the fund’s objectives is to “rebuild critical infrastructure.”
• Focus on battlefield-relevant projects. If the United States is prepared to support projects directly connected with Ukraine’s wartime needs, the USURIF could also explore investments in the cutting-edge defense sector, which is developing innovations in drone and electronic warfare that NATO militaries are increasingly eager to incorporate into their forces. The DFC has long maintained a prohibition on making investments in the defense sector, but the unique structure of the USURIF and the exigencies of Ukraine’s situation justify making an exception at least for the duration of the war. Ukrainian Prime Minister Yulia Svyrydenko said she discussed this possibility with her American counterparts in June, but it’s not clear whether it has progressed.
• Think multilaterally. Given the levels of complexity and the amount of capital and expertise required, both Ukraine’s reconstruction and the development of Western-oriented supply chains for critical materials should be thought of as team sports that will involve multiple countries and an array of public-private partnerships. The most obvious partner for the United States is the EU, which has had a relationship with Ukraine on critical minerals issues since before the war and has an equal or greater interest in developing Ukraine’s resources, given the continent’s lack of reserves of key materials. As some commentators have observed, the United States and Europe should consider multilateral approaches to the strategic raw materials challenge, giving rise to deeper defense-industry and supply-chain cooperation. Currently envisioned policies will need the participation of many actors beyond the DFC, as they require export controls, intervention in commodity markets, and government-directed and -funded cross-border industrial cooperation. Given Ukraine’s growing importance in the West’s defense ecosystem and its critical minerals potential, it is logical to invite Kyiv into these efforts at the beginning, and the USURIF can serve as a platform to launch broader cooperative efforts.
• Improve geological data. According to a report by the Kyiv School of Economics, the poor quality of geological data is among the top disincentives for attracting investment into Ukraine’s mining sector. The European Bank for Reconstruction and Development is leading a project to digitize the existing data, but there are additional needs, including new exploration programs to help identify the most promising deposits for future investment. The USURIF could help spearhead such a program (which could involve some public-private partnerships) to ensure the long-term viability of Ukraine’s mining sector. The objective could be a trusted, one-stop organization able to provide potential investors with data.

Conclusion

The USURIF epitomizes Trump’s preference for transactional diplomacy that can demonstrate tangible monetary benefits to the United States. His team is working energetically with its Ukrainian partners to ensure the initiative produces economic results in the near future. But even if the fund exceeds the most optimistic expectations, it alone will do little to address Ukraine’s existential challenge—the war with Russia. The founding documents of the USURIF acknowledge that the scope of U.S. interests in Ukraine goes beyond investments. The agreement’s preamble points out the importance of upholding European security and democratic values; elsewhere, the pact is described as “an expression of a broader, long-term strategic alignment between their peoples and governments, and a tangible demonstration of the United States of America’s support for Ukraine’s security, prosperity, reconstruction, and integration into global economic frameworks.”

In sum, Ukraine policy cannot neglect the diplomatic, security, humanitarian, and economic stakes for the United States. The USURIF has the potential to help integrate Ukraine into Western critical minerals supply chains and—if the agreement’s scope is expanded—contribute directly to the war effort by catalyzing investments in the defense and energy sectors. But this opportunity for mutual gains will only be realized if the United States does not neglect the comprehensive nature of the challenge nor reduce Ukraine policy to a balance sheet, which will risk prolonging the war and eroding allied cohesion.

Eric Green is a nonresident scholar at the Carnegie Endowment for International Peace who served in the U.S. Foreign Service for thirty-two years. He served as Special Assistant to President Joe Biden and Senior Director for Russia and Central Asia on the National Security Council staff from 2021 to 2023. Green also consults for private-sector companies, and his clients include firms in the critical minerals sector.

The author wishes to thank Alexander Joel of the Carnegie Endowment for International Peace for his assistance and Mykhailo Soldatenko and Peter Handley for their comments and expertise.