Local and foreign media have published the final draft of the US-Ukrainian agreement on joint development of Ukrainian mineral deposits, officially named as the Bilateral Agreement Establishing Terms and Conditions for a Reconstruction Investment Fund. Its key clauses are as follows: creation of the Reconstruction Investment Fund (RIF), jointly owned and managed by the two countries, that would invest in projects in Ukraine. The Fund will be filled with contributions from both the US and Ukraine and invest its proceeds into projects in Ukraine. Profits earned on this investment will be distributed according to the participants’ actual contributions. Ukraine will contribute to the Fund 50% of all revenues “earned from the future monetization of all relevant Ukrainian government-owned natural resource assets.” The latter includes deposits of natural resources and related infrastructure, such as LNG terminals or ports. Ukraine will not contribute revenues that it collects from existing projects. The sides “will strive to avoid conflicts with Ukraine’s obligations” under its EU accession and arrangements with IFIs. The signatories in the published draft include US Treasury Secretary Scott Bessent and Ukrainian First Deputy PM and Economy Minister Yulia Svyrydenko. The terms of the Fund’s operations, including the “timeline, scope and sustainability of contributions,” will be detailed in a separate agreement to be drafted by the two sides. According to President Volodymyr Zelensky, the agreed framework deal does not require parliamentary ratification, unlike the future Fund Agreement. On a related note, the framework agreement is expected to be signed during Zelensky’s visit to Washington on Friday. The Ukrainian leader is also expected to discuss with Trump potential US security guarantees as part of a broader peaceful settlement with Russia the US is trying to broker.

According to the CEO of DTEK Group, Maksym Tymchenko, the level of irrecoverable damage inflicted on DTEK Energy’s power generating equipment totals around 40%. DTEK plans to build new facilities to offset the damage.

Ukraine’s provisional merchandise trade deficit stood at $2.4bn in January, narrowing after a one-off surge to $3.8bn in December and moving back close to the November level of $2.5bn. Monthly imports stood at $5.5bn, down 22% m-o-m but up 9.3% y-o-y, while exports totaled $3.2bn, down 3.9% m-o-m and 6.5% y-o-y.

Ukraine’s iron ore exports fell by 9.2% m-o-m to 3.1 Mt in January, still up 0.5% y-o-y. In value terms, iron ore shipments shrank by 9.5% m-o-m to $247m (-17% y-o-y). Both the average export price of iron ore products and global benchmark price were flat m-o-m at $79/t (-17% y-o-y) and $97/t (-26% y-o-y), respectively.

Damage inflicted by the Russian invasion on Ukraine totaled $176bn as of end-2024, up $23bn from the $153bn estimated a year earlier, according to the fourth round of the Rapid Damage and Needs Assessment (RDNA 4), a joint study prepared by the World Bank, the European Commission, the Ukrainian government, and the United Nations.

President Volodymyr Zelensky is expected to travel to the US on Friday to meet President Donald Trump and finalize a revised agreement on joint development of Ukraine’s mineral deposits, according to media reports. Zelensky also intends to discuss US security guarantees during the talks. Commenting on these reports, Trump said he was ready to welcome Zelensky for signing the agreement “on rare earth and various other things,” calling it a “very big deal.” He said the agreement meant for Ukraine “the right to fight on” and, when asked whether supplies of US weapons to Ukraine would continue, added: “Maybe until we have a deal with Russia.” Touching on the unfolding talks to end the war, Trump said a settlement would necessitate peacekeeping troops in Ukraine in “some form.”

The Ministry of Finance placed UAH 16bn ($0.4bn) of hryvnia-denominated bonds at primary auctions in February, down from UAH 27bn in January ($0.6bn). It also sold $250m of USD-denominated bonds this month. With UAH 41bn ($1.0bn) of UAH bonds redeemed, MinFin is finishing February with a net redemption of $0.4bn, including a $0.6bn net redemption on UAH debt and $250m net sale of F/X bonds.

More than 20 European and other foreign leaders, including from Canada and Japan, attended yesterday, in person and online, a summit organized by the Ukrainian leadership to mark the third anniversary of the Russian invasion. Among the major announcements made, the UK confirmed GBP 4.5bn ($5.6bn) in military aid for Ukraine in 2025, followed by Norway with EUR 3.5bn ($3.7bn), Spain with EUR 1bn ($1.05bn), and smaller donations from around a dozen other European countries and Canada. In particular, Sweden, which last month announced $1.2bn in military assistance for Ukraine in 2025, donated an additional $110m for air defense. Finally, a Nordic-Baltic coalition (Denmark, Finland, Iceland, Norway, Sweden, Estonia, Latvia, and Lithuania) committed to equip and train a Ukrainian brigade. An EU summit on Mar. 6 is expected to discuss further military assistance for Ukraine potentially totaling upwards of EUR 20bn. On a related note, Canadian Prime Minister Justin Trudeau announced that the first half of Canada’s CAD 5bn ($3.6bn) contribution to the G7’s Extraordinary Revenue Acceleration (ERA) Loans mechanism for Ukraine will be disbursed in the coming days, with the remainder “to follow soon.”

US President Donald Trump said yesterday the US and Ukraine were “very close” to signing a revenue-sharing agreement on Ukraine’s critical mineral deposits. Speaking during a meeting with visiting French President Emmanuel Macron, Trump said President Volodymyr Zelensky “may come in this week or next week to sign the agreement, which would be nice.” Macron in turn said Europe was ready to provide security guarantees to Ukraine, including peacekeepers, after a ceasefire was reached, while Trump supported this idea and said Russia would accept it. In a social-media post dedicated to Macron’s visit, Trump said he emphasized the importance of the “critical minerals and rare-earths deal” with Ukraine at a meeting with G7 leaders. At the same time, he said he was in “serious discussions” with Russian President Vladimir Putin about ending the war in Ukraine and developing “major economic development transactions” between the US and Russia.

The European Commission has offered a new support package to Ukraine to secure its energy system and enable full integration within the European energy market. Besides facilitating the Ukrainian electricity and gas markets’ integration with the EU, the package would assist Ukraine in funding gas purchases to ensure ample gas reserves and security of supply. Gas purchases would be funded in the framework of the existing EUR 50bn Ukraine Facility program. The announced package would also accelerate investments in renewable energy, adding up to 1.5 GW of generating capacity.

The CEO of state rail monopoly Ukrainian Railways (RAILUA), Oleksandr Pertsovskyi, said in a media interview that the company’s operating profit from cargo transportation would drop to UAH 5-6bn in 2025 (from c. UAH 20bn in 2023) if freight tariffs remained unchanged, thus failing to cover a projected operating loss from passenger transportation of UAH 22bn. In related news, Ukrainian Railways reported freight transportation of 14.0 Mt in January, down 0.2% m-o-m and 0.9% y-o-y.

Key highlights from last week: The past seven days, in the run-up to the third anniversary of the Russian invasion, extended the YTD streak of slowed Russian ground attacks and territorial gains. Russia has escalated drone attacks against Ukraine’s civilian infrastructure, but with little effect.

President Volodymyr Zelensky said yesterday negotiations with the US on a deal to access Ukraine’s rare earth and other deposits were continuing but Ukraine rejected initial US demands, such as paying back $500bn in natural resource revenues, including for previously delivered US aid. “The question of $500 billion is no longer there,” Zelensky said, adding that Ukraine wanted the agreement to include clearly spelled out US security guarantees. Zelensky also said US military aid for Ukraine was continuing despite there being no agreement on US access to Ukraine’s mineral resource base.

EU officials are discussing how the immobilized assets of Russia’s central bank could be used to compensate for Russia’s war-inflicted damage on Ukraine in case Russia fails to pay reparations in a potential peace deal, Bloomberg reported, citing anonymous sources.

Ukrainian sovereign and corporate bonds have been on an upward trend since early October 2024, driven by the US election results and expectations of a potential ceasefire.