From Raw Materials to Resilience: Can Ukraine Turn Resources into Recovery?
The Ukrainian post-war economy will have two tasks at a time: on the one hand, it needs to rebuild the destroyed infrastructure, and on the other hand, it needs to break the inertial “extract and sell” model that made the country a raw material appendage of global chains.
As the United States and Ukraine have finally signed their minerals deal, Kyiv now has to turn resource extraction into profit—funding recovery efforts and military equipment to defend itself from Russia regardless of a potential ceasefire.
In this context, the main question of the next decade is whether Ukraine can transform its natural resource portfolio into a driver of industrial and technological growth, rather than merely another “rent valve” for financing imports.
Reconstruction Fund: a Tool, Not a Slogan
In the official architecture of Ukrainian post-war finances, the Reconstruction Fund will become the central hub through which credit lines, partner grants, and donor earmarks are to flow.
The third damage assessment conducted by the World Bank, the EU, and the UN has set funding priorities for 2024-2027 at $15 billion annually, with industry and services for the first time being placed in a separate segment with a budget of almost $3.6 billion.
This emphasis is not accidental: The Ukraine Facility Plan explicitly points to the need to integrate titanium, lithium, and graphite processing projects into the green modernization of the energy and defense industries. Thus, the fund is positioned not only as a “construction cash desk” but also as a venture capitalist co-financing deep processing of resources, from cathode material for batteries to powder titanium metallurgy.
The control mechanism is crucial: funds are mobilized through sectoral trusts, where the state's share of funding is tied to the achievement of KPIs for localization of production, exports with a high share of added value, and long-term fiscal parameters. The first agreements are already being tested in the United-24 pilot format: the changed procedure for using the funds raised on the platform allowed the Ministry of Economy to open targeted collections for specific industrial clusters. This creates a direct link between donor dollars and job creation in the recycling sector.
Investment Potential: Private and Public Tracks
It is symbolic that the discussion of private investment in the recovery is taking place not in Brussels or Washington, but during a meeting of G7 finance ministers in Banff, Canada, where Kyiv presented its investment package to large pension funds for the first time.
Canada and the United States, with their own friend-shoring programs, are looking at Ukrainian resources through the prism of supply chains for the energy transition. The U.S.-Ukraine agreement on cooperation in critical minerals secured Washington's priority access to a share of revenues from future production, which, in theory, should be converted into direct investment in mine infrastructure and processing plants. Instead, the EU prefers to formalize this through the deepening of the 2021 Strategic Partnership for Critical Raw Materials, having already funded two projects: a titanium ore pilot and a supply chain efficiency program.
Within the domestic market, the key to capital mobilization is war risk guarantees. An investment insurance instrument has been introduced under the Ukraine Recovery and Reconstruction Guarantee Facility (URGF), implemented through the EBRD in cooperation with insurance companies. This mechanism is already being used by Ukrainian insurance companies to cover transportation infrastructure risks, and its potential for expansion to industry is significant.
Long-term Partnership: from Transit Policy to Co-production Policy
For decades, Ukraine's resource relations were built on a transit logic: gas pipes, iron ore, and grain. Today, co-production is coming to the fore. Some international players, including investors from the G7 countries, are considering setting up processing facilities in Ukraine, particularly in the areas of graphite and lithium. Most of the initiatives are at the stage of negotiations, signing memorandums, or investment assessment.
An illustrative case was the practice of exporting titanium to China in the late 2010s, which was part of a broader strategy to diversify markets, but the volume of supplies was limited. In 2022, for example, the volume of titanium concentrate exports to China amounted to approximately $2.1 million, which is a small share of total supplies. Thus, the dependence on the Chinese market was not decisive, but it demonstrates the risks of price pressure from large consumers.
New Klondike on Critical Resources: Chains from Mine to Cathode
The greatest value-added potential is concentrated in four resource groups. First, lithium. Ukraine's deposits are estimated at 500 thousand tons of lithium oxide, or about 3% of the world's reserves, but production is still low. The cost of infrastructure for deep mines and autoclave processing is high, but with the right financing scheme, the full cycle can pay off in a fairly short time.
Secondly, titanium. In 2024, concentrate production dropped to 120 kt of ilmenite, three times less than the pre-crisis level, but several new quarries in Dnipro and Zhytomyr regions are undergoing accelerated EIAs. The new strategy of the Ministry of Strategic Industries envisages a reorientation to powder metallurgy, where the price premium reaches 400-500% of the concentrate cost, and the consumers are the EU's aviation and medical clusters.
The third segment is graphite. Despite the temporary shutdown of the Zavalivsky GOK in 2024, Ukraine retains a significant share of natural graphite reserves in Europe.
Finally, manganese. Ukraine has one of the world's largest manganese ore reserves and is already one of the suppliers of ferromanganese to the Central European markets. Further development potential is associated with the production of electrolytic manganese for the battery sector.
However, resource cloning does not guarantee automatic growth. The main risk is “rent plus corruption,” when a short political horizon sweeps away long investment cycles. The second weak link is the energy infrastructure: titanium and graphite processing requires relatively cheap electricity, and substations in the east of the country cannot withstand drone strikes. The third threat is environmental. Uranium and lithium will be under the watchful eye of European regulators, and non-compliance with ESG standards may block exports to OECD countries.
Three Pillars of Success
Therefore, the formula for success has three components. The first is infrastructure security guarantees, which are included as a separate clause in security agreements with allies. The second is an institutional grid that prevents the deregulated outflow of cash flow to offshore: a transparent system of auctions for special permits, mandatory import VAT on concentrate from subsoil use, and royalty credits for capex for processing. The third is human resources: without reorienting university programs from classical mining to materials chemistry and battery tech, the shortage of specialists will kill any strategy.
Ukraine is at a crossroads when it comes to the path of the raw materials periphery and joining the club of high-tech materials suppliers. The Reconstruction Fund creates a financial basis, but only on condition of deep processing. Private capital is ready to enter if the government insures war risks and maintains regulatory predictability.
Long-term partnerships with the United States, Canada, and the EU are turning from protocols of intent into joint plants and R&D centers, tying allies to Ukraine's security not with declarations but with capital and contracts. Finally, the resource clandestine in lithium, titanium, graphite, and manganese is not about handing out licenses, but about forming a domestic industrial chain capable of generating a multiple increase in GDP and tax revenues.
It all depends on whether the country can protect its infrastructure, discipline rents, and quickly grow a new engineering school. If these three conditions are met, added value will cease to be a slogan and become the main asset of Ukraine's recovery and security.
Bohdan Popov, head of digital at the United Ukraine Think Tank, communications specialist, and public figure