{"id":25495,"date":"2025-05-12T20:01:04","date_gmt":"2025-05-12T20:01:04","guid":{"rendered":"https:\/\/peacerep.org\/?p=25495"},"modified":"2025-06-12T20:10:29","modified_gmt":"2025-06-12T20:10:29","slug":"ukraines-economy-has-greater-staying-power-than-russias-but-the-us-mineral-deal-shows-how-fragile-its-advantage-is","status":"publish","type":"post","link":"https:\/\/gentest.cahss.ed.ac.uk\/dev-peacerep\/2025\/05\/12\/ukraines-economy-has-greater-staying-power-than-russias-but-the-us-mineral-deal-shows-how-fragile-its-advantage-is\/","title":{"rendered":"Ukraine\u2019s economy has greater staying power than Russia\u2019s, but the US mineral deal shows how fragile its advantage is"},"content":{"rendered":"<p><strong>A recent PeaceRep report on the Russo-Ukrainian War has been featured in The Guardian, where Luke Cooper outlines the difficult terms Kyiv has agreed to in order to keep the US on side. An excerpt is reproduced below. For the full piece, <a href=\"https:\/\/www.theguardian.com\/commentisfree\/2025\/may\/07\/ukraine-economy-russia-us-mineral-deal-kyiv\">read the original in The Guardian<\/a>.<\/strong><\/p>\n<p>Despite Russia\u2019s occupation of its territory, missile attacks on its infrastructure and the enormous human costs of the war, Ukraine\u2019s economy has been impressively resilient. Its effective military resistance against a much stronger adversary is in fact underpinned by this successful economic management. Rather than face institutional sclerosis or even collapse, Ukraine\u2019s state capacity has been strengthened by the conflict. Through a combination of tax revenue collection and substantial networks of voluntary fundraising, the state has dramatically increased the size of its armed forces, invested in defence production and maintained a decent level of public infrastructure.<\/p>\n<p>State spending on soldiers\u2019 wages, infrastructure and logistics \u2013 including public sector procurement from private firms \u2013 has had a positive knock-on effect, supporting demand in the civilian market economy. Soldiers on the frontline earn well above the national average wage. An innovative military industrial complex, combining traditional state-owned enterprises with an\u00a0<a href=\"https:\/\/www.theguardian.com\/world\/2025\/apr\/23\/they-cannot-be-jammed-fibre-optic-drones-pose-new-threat-in-ukraine\" data-link-name=\"in body link\">ecosystem of drone startups<\/a>, has been developed. These policies have stabilised the Ukrainian economy and directed it to the goal of the country\u2019s basic survival.<\/p>\n<p>But while Ukraine must be credited with these successes, it still lacks the resources domestically to meet the enormous costs of the war. External financial support has been vital to keeping the country afloat. Its wartime resilience is in this sense built on a contradiction: state capacity has grown considerably, but it has done so through a fundamental dependence on foreign financial assistance. Ukraine records a negative gross domestic savings rate, for example \u2013 an indicator of an economy that is consuming (including military spending) more each year than its annual economic output. This is made possible thanks to financial aid from Ukraine\u2019s allies.<\/p>\n<p>As I argue in my recent\u00a0<a href=\"https:\/\/peacerep.org\/publication\/russo-ukrainian-war\/\" data-link-name=\"in body link\">report<\/a>, Russo-Ukrainian War: The Political Economy of the Present Balance of Forces<em style=\"font-weight: inherit;\">,\u00a0<\/em>despite this dependency, Ukraine has made the best of the situation, and Russia\u2019s economic position is less strong than it is often portrayed.<\/p>\n<p><a href=\"https:\/\/www.theguardian.com\/commentisfree\/2025\/may\/07\/ukraine-economy-russia-us-mineral-deal-kyiv\">Read the full piece on The Guardian.<\/a><\/p>\n<p><a href=\"https:\/\/peacerep.org\/publication\/russo-ukrainian-war\/\">Read the report: Russo-Ukrainian War: The Political Economy of the Present Balance of Forces<\/a><\/p>\n<p>\u00a0<\/p>\n<p><strong>About the author: <\/strong>Luke Cooper is a Senior Research Fellow at LSE IDEAS and PeaceRep\u2019s Ukraine research lead.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Kyiv still relies heavily on foreign support for its war effort, and it has agreed to difficult terms to keep the US on side, writes Luke Cooper.<\/p>\n","protected":false},"author":166,"featured_media":25506,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_FSMCFIC_featured_image_caption":"","_FSMCFIC_featured_image_nocaption":"","_FSMCFIC_featured_image_hide":"","footnotes":""},"categories":[233,1837],"tags":[],"class_list":["post-25495","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-ukraine"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Ukraine\u2019s economy has greater staying power than Russia\u2019s, but the US mineral deal shows how fragile its advantage is - PeaceRep<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Ukraine\u2019s economy has greater staying power than Russia\u2019s, but the US mineral deal shows how fragile its advantage is - PeaceRep\" \/>\n<meta property=\"og:description\" content=\"Kyiv still relies heavily on foreign support for its war effort, and it has agreed to difficult terms to keep the US on side, writes Luke Cooper.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/gentest.cahss.ed.ac.uk\/dev-peacerep\/2025\/05\/12\/ukraines-economy-has-greater-staying-power-than-russias-but-the-us-mineral-deal-shows-how-fragile-its-advantage-is\/\" \/>\n<meta property=\"og:site_name\" content=\"PeaceRep\" \/>\n<meta property=\"article:published_time\" content=\"2025-05-12T20:01:04+00:00\" \/>\n<meta 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