Anchoring Ukraine's postwar recovery with a US-Ukraine free trade agreement

Robert Lawrence and Sergii Telenyk
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Sergii Telenyk: New York University School of Law

No PB26-6, Policy Briefs from Peterson Institute for International Economics

Abstract: Key Takeaways - An FTA with the United States would help Ukraine achieve stronger investor protections, regulatory transparency, and anticorruption and dispute settlement mechanisms that anchor private investment needed to support reconstruction and sustain long-term growth. - For the United States, Ukraine offers a strategically valuable production platform: a large, skilled workforce; a legacy industrial base; and significant reserves of critical minerals, metals, and agricultural inputs needed for energy transition, defense, and supply chain resilience. - Passage of a US-Ukraine FTA in Congress could be controversial because it would bundle together some of the most contentious issues in US trade politics--agriculture, investor protection, government procurement, digital rules, and market access--into one high-salience vote. Policymakers could start by advancing more limited agreements as precursors to a comprehensive FTA. - Accession to the European Union will be the core of Ukraine's reconstruction strategy, implying that a US-Ukraine FTA should be designed to complement, rather than compete with, EU integration. Ukraine's reconstruction is often framed as a financing challenge, but the bigger challenge is institutional: Ukraine must credibly reassure domestic and foreign investors that market-oriented rules, transparent regulation, private property protection, and contract enforcement will prevail and that its territorial integrity will be secure. A free trade agreement with the United States can help Ukraine provide this assurance.

Date: 2026-03
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