The following is the April 22, 2025 edition of our Ukraine Business Roundup weekly newsletter. To get the biggest news in business and tech from Ukraine directly in your inbox, subscribe here.
As a U.S.-proposed deal for Ukraine’s natural resources stalled amid months of tense negotiations, some in Ukraine who were initially optimistic about the agreement are starting to lose hope.
At least that’s how one graphite mine in Ukraine’s central Kirovohrad Oblast feels about it, business reporter Dominic Culverwell reports in his latest.
The Zavalivskiy mine, located in the village of Zavallia, holds some 7.5 million metric tons of graphite ore in the second largest flake graphite mine in Europe.
But the war has taken a big toll on the mine. Since the start of Russia’s full-scale invasion, the company has lost nearly a third of its workforce. Production has plummeted from 15,000 metric tons annually to 850 metric tons last year and it’s lost around half of its customers around the world.
Which is why, when the minerals deal came about, the company’s CEO was pretty excited.
“I think that it would be really positive if the U.S. came to the Ukrainian mining market. They should spend money and time to build something, to mine something,” CEO Ostap Kostyuk told the Kyiv Independent in February, emphasizing the critical need for investments in the underfunded sector.
In Zavalivskiy Graphite’s case, innovation brought in through investors could involve high-tech equipment to purify graphite to a level suitable for use in batteries, called spherical graphite (SPG), which sells for $3,500- $10,000 per metric ton.
Machinery for SPG purification costs $30-40 million, which the currently unprofitable company can’t afford. Kostyuk was optimistic the Americans could bring in this technology and cooperate with Zavalivskiy to produce the highly purified graphite and break into a market dominated by China.
But as events unfolded, drafts of the deal were leaked to the public, and it became apparent the U.S. was proposing to gain unprecedented control over Ukraine’s sovereign natural resources as “repayment” for its military aid to Ukraine, Kostyuk lost the faith.
Even if the deal is signed this week, which is supposed to happen, the fears that it could be a win-lose for Ukraine have already settled in.
The minerals deal saga has left Kostyuk feeling that Ukraine is on the verge of being “scammed” and will end up on its own, indebted to its allies, Culverwell writes.
“We should recover ourselves. If this help is a debt, my kids and grandkids will pay this debt. So what can we do? We can't do anything,” Kostyuk said in April.
Read the full story here.
Central Bank halts hikes
Following a series of rate hikes since the beginning of the year, Ukraine’s Central Bank held the interest rate at 15.5% as it expects inflation to begin cooling.
The bank also said, however, that “due to the high level of uncertainty, which has only increased over past months, the National Bank of Ukraine will respond flexibly to changes in the balance of risks to the price dynamics and inflation expectations.”
Price growth is expected to start slowing this summer after it hit its highest level since May 2023 in March, reaching 14.6%. The bank expects inflation to drop to 8.7% at the end of 2025 and reach a target of 5% in 2026.
Ukraine vs. Russia
Ukraine’s economic resilience may outlast Russia's oil-funded war machine, says a new report by the London School of Economics' foreign policy think tank LSE IDEAS.
The report looks closely at how both Russia and Ukraine have adapted their economies to the demands of war. Despite the difficulties brought on by a full-scale invasion, the report finds that Ukraine — buoyed by external financing secured through 2027 and improved tax mobilization — is in a surprisingly strong negotiating position.
In contrast, Russia’s continued dependence on oil revenues makes it highly vulnerable to price volatility in global oil markets. The country is also facing a looming credit crunch and a potential systemic banking crisis, the report says.
While neither side is set up for “total victory,” Russia’s internal vulnerabilities may change its negotiating calculus in the year ahead, says Dr. Luke Cooper, author of the report and associate professorial research fellow in international relations.
“Even in the face of the (President Donald) Trump administration’s apparent pivot towards the Russian side, Ukraine and its European allies hold more ‘cards’ than many, including President Trump, seem to believe,” says Cooper.
Read the full report here.
What I'm watching
The spring meetings of the International Monetary Fund and World Bank are happening this week in Washington, D.C., with President Donald Trump’s tariff spree expected to dominate talks.
But as Trump and his team take an axe to institutions — and the world order as we know it — people attending the talks are wondering what implications the Trump administration's inward turn away from its global alliances will mean for institutions like the IMF and World Bank.
According to Jimena Zuniga of Bloomberg Economics, a weakened IMF and World Bank would put at risk the emerging markets around the world that rely on the IMF to respond to fiscal challenges such as high debt or shrinking reserves — a list of markets which includes Ukraine.
The IMF came to Ukraine’s aid at the start of the full-scale invasion, lending to a country at war for the first time in its nearly 80-year history. In March 2023, the IMF and Ukraine agreed on a loan program to provide Kyiv with $15.6 billion in financing for budget support over four years.
Stay tuned for more.
What else is in the news
Ukraine allocating one-third of defense budget for high-tech weapons production
The high-tech weaponry includes drones, electronic warfare systems, and missile technologies, Hlib Kanievskyi, a procurement chief at the Defense Ministry, said on April 21. Kanievskyi also said that the unification of technical standards for drones is among the key objectives for 2025 as the ministry looks to streamline procurement procedures, create a single framework for evaluating products, and accelerate decision-making.
Ukrainian airline resumes first regular flights since 2022, flying from Moldova to EU
Ukrainian airline SkyUp Airlines has made its first regular flight since the start of Russia's full-scale invasion, flying on the Chisinau-Paris route on April 18, the AIN news outlet reported, citing the company's press service. Another flight is scheduled for Lisbon, and the company will also operate routes to 11 cities in seven countries, including France, Spain, Cyprus, Greece, Germany, Czechia, and Sweden.
French court enforces $5 billion Crimea damages award against Russia in Naftogaz case
A French court has approved the enforcement of a $5 billion arbitration award against Russia for damages caused to Ukraine's state-owned energy company Naftogaz during the occupation of Crimea, the company said on April 17. The decision allows Naftogaz to begin legal recovery efforts in France, including seizing Russian state assets to satisfy the award.
