The US Treasury has announced it has agreed to establish an American-Ukrainian reconstruction investment fund.

For Ukraine, the economic deal was seen as possibly key to ensuring its access to future US military aid in its war against Russia.

President Trump had previously called for Kyiv to compensate Washington for billions of dollars in assistance to help repel the Kremlin’s forces.

A senior Ukrainian official said on Wednesday the US will make “direct financial contributions” to the fund and “may also provide new assistance” such as air defence systems for Ukraine.

In return the US is set to get preferential access to any new deals concerning Ukraine’s mineral resources.

Trump latest: Deal shows Trump ‘committed to free Ukraine’

The US Treasury said “in recognition of the significant financial and material support” the US has provided to the “defence of Ukraine… this economic partnership positions our two countries to work collaboratively and invest together to… accelerate Ukraine’s economic recovery”.

US treasury secretary Scott Bessent said: “This agreement signals clearly to Russia that the Trump administration is committed to a peace process centered on a free, sovereign, and prosperous Ukraine over the long term.”

He also said “this partnership allows the US to invest alongside Ukraine, to unlock Ukraine’s growth assets, mobilise American talent, capital and governance standards that will improve Ukraine’s investment climate and accelerate Ukraine’s economic recovery”.

Britain’s Foreign Secretary Davis Lammy has welcomed the deal.

Donald Trump indicated in February he wanted access to Ukraine’s rare earth materials, describing it as reimbursement for the billions of dollars in aid the US has given to Kyiv.

But talks stalled after a heated Oval Office meeting between him and Ukraine’s President Volodymyr Zelenskyy, and reaching an agreement since then has proven difficult amid strained relations between Washington and Kyiv.

Trump is closer to ending Ukraine war than ever before

David Blevins

News correspondent

@skydavidblevins

They are calling this a “reconstruction investment fund” but it gives the US access to things like graphite, aluminium, oil and gas.

The White House has confirmed this is indeed the oft-referenced “minerals deal”, and it will pay dividends in various ways.

Economically it allows the US to say they are clawing back the billions of dollars it has offered in military aid to Ukraine.

Politically, by having an investment on the ground, it allows Donald Trump to claim he’s giving Volodymyr Zelenskyy the security guarantees he’s sought for so long.

It is the latest chapter in a remarkable story.

The jaw-dropping showdown between Mr Trump and Mr Zelenskyy in the Oval Office at the end of February, when the US was seemingly suggesting Ukraine was somehow responsible for the Russian invasion, redefined old allegiances in real time before our very eyes, to the shock of other world leaders.

Then last weekend, we saw the two men again seated together just feet apart at St Peter’s Basilica in Rome at the funeral of Pope Francis, closing the gap both literally and politically.

Mr Trump vowed to end the war in Ukraine on his first day in office. On his 101st day, he’s closer to doing that than he ever has been before.

Why is US interested in Ukraine’s raw materials?

The US is seeking access to over 20 raw materials seen as strategically critical to its interests, including some non-minerals such as oil and natural gas.

Among them are Ukraine’s deposits of titanium, which is used for making aircraft wings and other aerospace manufacturing, and uranium, that is used for nuclear power, medical equipment and weapons.

Ukraine also has lithium, graphite and manganese, which are used in electric vehicle batteries.

On Wednesday, Ukraine’s first deputy prime minister Yulia Svyrydenko said she had signed the agreement in Washington DC to create the investment fund.

She wrote on X: “Together with the United States, we are creating the fund that will attract global investment into our country.

“Its implementation allows both countries to expand their economic potential through equal cooperation and investment.

“The United States will contribute to the fund. In addition to direct financial contributions, it may also provide new assistance – for example air defence systems for Ukraine.”

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The announcement comes as the Trump administration is pushing to stop the war, which erupted in February 2022 when Russia launched a full-scale invasion.

Russian President Vladimir Putin backs calls for a ceasefire before peace negotiations, “but before it’s done, it’s necessary to answer a few questions and sort out a few nuances”, Kremlin spokesman Dmitry Peskov has said.

Mr Putin is also ready for direct talks with Ukraine without preconditions to seek a peace deal, he added.

On Monday, the Russian leader declared there would be a three-day ceasefire from 8 May to 10 May.

Mr Zelenskyy wants an immediate ceasefire lasting at least 30 days.