Ukraine's PM reveals how US-backed fund for minerals will be managed and where the profits will go
Ukraine has secured equal management rights in talks with the United States on establishing a joint investment fund under a critical minerals deal and has ensured that any disputes will not be governed solely by US law.
"Ukraine and the United States will contribute to the fund. The fund is managed by 50-50 partners, with three representatives on the board appointed by Ukraine and three by the United States," Ukraine's Prime Minister Denys Shmyhal said on the national joint 24/7 newscast.
Shmyhal stressed that the voting power of the Ukrainian and American representatives will be equal, meaning the US side will not hold the casting vote.
The prime minister, who said earlier that the agreement could be signed within 24 hours, noted that the parties have agreed on key details about how the new structure will function. Under the agreement, the fund will be established by Ukraine and the United States and managed on a parity basis.
An earlier draft of the agreement would have effectively granted the United States sole control over the fund.
Another important change to that draft is that the fund will not be subject to US law.
"Disputes under this agreement are resolved through mutual consultations. In the previous agreement, this was stipulated [through proceedings in a US court] under US law. We've removed this so that the agreement is truly a partnership. This is an important achievement," Shmyhal explained.
Shmyhal added that, subject to board approval, the fund could also attract other partners to invest in Ukraine and offer financial support for their projects.
He also emphasised that the United States will not be allowed to withdraw profits from its operations in Ukraine for the first ten years after the fund is established.
"The fund's profits may be distributed by mutual agreement no earlier than ten years from now. During those ten years, all profits will be reinvested in Ukraine's development and recovery," the prime minister said, emphasising that Ukraine will contribute 50% of the amount of future royalties on mineral resources to the fund.
As reported, Ukraine's Prime Minister Denys Shmyhal has confirmed that a draft minerals agreement with the US does not contradict its European integration commitments.
On 17 April, Ukraine and the United States signed a memorandum of intent to "finalise a formal agreement on economic partnership and a reconstruction investment fund".
More details can be found here: Speedy deal, strategic gains: inside the US-Ukraine mineral agreement timeline.